(k)(3)
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AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT
among
▇▇▇ ▇▇▇▇▇▇ SENIOR LOAN FUND,
as Borrower
FALCON ASSET SECURITIZATION COMPANY LLC
and
CHARIOT FUNDING LLC,
as Conduit Lenders
THE SECONDARY LENDERS PARTIES HERETO
and
JPMORGAN CHASE BANK, N.A,,
as Program Agent
Dated as of July 14, 2006
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[Type VII-C]
TABLE OF CONTENTS
Page
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AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1.01. Definitions...............................................................1
SECTION 1.02. Rules of Construction....................................................24
SECTION 1.03. Computation of Time Periods..............................................24
ARTICLE II
ADVANCES TO THE BORROWER
SECTION 2.01. Advance Facility.........................................................24
SECTION 2.02. Making of Advances.......................................................25
SECTION 2.03. Noteless Agreement; Evidence of Indebtedness.............................26
SECTION 2.04. Maturity of the Advances.................................................27
SECTION 2.05. Prepayment of the Advances...............................................27
SECTION 2.06. Yield................................................................... 28
SECTION 2.07. Increased Costs..........................................................28
SECTION 2.08. Compensation.............................................................30
SECTION 2.09. Additional Yield on Eurodollar Rate Advances.............................30
SECTION 2.10. Termination or Reduction of the Total Commitment.........................31
SECTION 2.11. Rescission or Return of Payment..........................................31
SECTION 2.12. Fees Payable by Borrower.................................................31
SECTION 2.13. Post Default Interest....................................................31
SECTION 2.14. Payments.................................................................31
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SECTION 2.15. Ratable Payments.........................................................32
SECTION 2.16. Borrower's Obligations Absolute..........................................33
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.01. Conditions Precedent to the Effectiveness of the Existing Credit
Agreement on the Closing Date..........................................33
SECTION 3.02. Conditions Precedent to All Advances.....................................35
SECTION 3.03. Conditions Precedent to the Effectiveness of this Agreement..............35
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower...........................36
ARTICLE V
COVENANTS
SECTION 5.01. Affirmative Covenants of the Borrower....................................40
SECTION 5.02. Negative Covenants of the Borrower.......................................45
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default........................................................48
ARTICLE VII
PLEDGE OF PLEDGED COLLATERAL;
RIGHTS OF THE PROGRAM AGENT
SECTION 7.01. Security Interests.......................................................51
SECTION 7.02. Substitution of Collateral and Release of Security Interest..............52
SECTION 7.03. Application of Proceeds..................................................53
SECTION 7.04. Rights and Remedies upon Event of Default................................54
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SECTION 7.05. Remedies Cumulative......................................................55
SECTION 7.06. Enforcement of Remedies under the Custodial Agreement and the Loan
Documents..............................................................51
ARTICLE VIII
THE PROGRAM AGENT
SECTION 8.01. Authorization and Action.................................................55
SECTION 8.02. Delegation of Duties.....................................................56
SECTION 8.03. Program Agent's Reliance, Etc............................................56
SECTION 8.04. Indemnification..........................................................57
SECTION 8.05. Successor Program Agent..................................................57
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. No Waiver; Modifications in Writing......................................58
SECTION 9.02. Notices, Etc.............................................................58
SECTION 9.03. Taxes................................................................... 60
SECTION 9.04. Costs and Expenses; Indemnification......................................62
SECTION 9.05. Execution in Counterparts................................................63
SECTION 9.06. Assignability............................................................63
SECTION 9.07. Governing Law............................................................65
SECTION 9.08. Severability of Provisions...............................................65
SECTION 9.09. Confidentiality..........................................................65
SECTION 9.10. Merger...................................................................67
SECTION 9.11. No Proceedings...........................................................67
SECTION 9.12. Survival of Representations and Warranties...............................67
SECTION 9.13. Loan Documents...........................................................67
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SECTION 9.14. Submission to Jurisdiction; Waivers......................................68
SECTION 9.15. E-Mail Reports...........................................................68
SECTION 9.16. Waiver of Jury Trial.....................................................69
SECTION 9.17. Several Obligations......................................................69
SECTION 9.18. Limitation on Liability..................................................70
SECTION 9.19. Patriot Act Notice.......................................................67
SECTION 9.20. No Novation..............................................................67
SCHEDULES
Schedule I Form of Investor Report
Schedule II Form of Plan Arrangements
EXHIBITS
EXHIBIT A Form of Advance Note
EXHIBIT B Form of Notice of Borrowing
EXHIBIT C Form of Assignment and Acceptance
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AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT
This AMENDED AND RESTATED REVOLVING CREDIT AND SECURITY AGREEMENT, dated as
of July 14, 2006 is entered into among FALCON ASSET SECURITIZATION COMPANY LLC
(formerly Falcon Asset Securitization Corporation), CHARIOT FUNDING LLC,
JPMORGAN CHASE BANK, N.A. (as successor by merger to Bank One, NA (Main office
Chicago)), STATE STREET BANK AND TRUST COMPANY, THE BANK OF NEW YORK, LLOYDS TSB
BANK plc and the other Secondary Lenders (as hereinafter defined) from time to
time parties hereto, JPMORGAN CHASE BANK, N.A. (as successor by merger to Bank
One, NA (Main Office Chicago)), as program agent for the Secured Parties (as
hereinafter defined) (in such capacity, together with its successors and
assigns, the "Program Agent") and ▇▇▇ ▇▇▇▇▇▇ SENIOR LOAN FUND (together with its
permitted successors and assigns, the "Borrower"), to amend and restate the
Revolving Credit and Security Agreement entered into as of November 17, 2003
among the Borrower, Falcon Asset Securitization Company LLC, the Secondary
Lenders parties thereto, and the Program Agent (as amended, supplemented or
otherwise modified prior to the Restatement Effective Date, the "Existing Credit
Agreement"), and, from and after the Restatement Effective Date, the Existing
Credit Agreement is hereby amended and restated in its entirety.
W I T N E S S E T H:
WHEREAS, the Borrower desires that the Conduit Lenders (as hereinafter
defined) and the Secondary Lenders from time to time make advances to the
Borrower on the terms and subject to the conditions set forth in this Agreement;
and
WHEREAS, the Conduit Lenders and the Secondary Lenders are willing to make
such advances to the Borrower on the terms and subject to the conditions set
forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1.01. Definitions.
As used in this Agreement, the following terms shall have the meanings
indicated:
"Adjusted Asset Value" means in respect of any Borrowing Base Eligible
Asset an amount equal to the product of (i) the Asset Value of such Borrowing
Base Eligible Asset, and (ii) the applicable Advance Rate for such Borrowing
Base Eligible Asset.
"Advance" means each advance by a Conduit Lender or a Secondary Lender to
the Borrower on a Borrowing Date pursuant to Article II; provided, that if a
Conduit Lender assigns a portion of any Advance made by it to a Lender pursuant
to the Asset Purchase Agreement or otherwise or any Secondary Lender assigns a
portion of any outstanding Advance made by it pursuant to an Assignment and
Acceptance and in accordance with and subject to Section 9.06(b), the portion of
such Advance retained by such Conduit Lender or Secondary Lender, as the case
may be, and the portion of such Advance acquired by such assignee shall each be
deemed to constitute a separate Advance for purposes of this Agreement.
"Advance Note" means each promissory note issued by the Borrower to a
Conduit Lender or a Secondary Lender in accordance with the provisions of
Section 2.03, substantially in the form of Exhibit A hereto, as the same may
from time to time be amended, supplemented, waived or modified.
"Advance Rate" means (i) in respect of Cash, 100%, (ii) in respect of
Eligible Commercial Paper Notes and Eligible Government Securities, 95%, (iii)
in respect of Class A Loan Assets, 80%, (iv) in respect of Class B Loan Assets,
70%, (v) in respect of Class C Loan Assets, 60%, and (vi) in respect of Class D
Loan Assets, 50%.
"Adverse Claim" means any Lien or other right, claim, encumbrance or any
other type of preferential arrangement in, of or on any Person's assets or
properties in favor of any other Person, other than Permitted Liens.
"Adviser" means ▇▇▇ ▇▇▇▇▇▇ Asset Management (formerly ▇▇▇ ▇▇▇▇▇▇ Investment
Advisory Corp.), together with its permitted successors and assigns.
"Adviser Material Adverse Effect" means (i) a material adverse effect on
the ability of the Adviser to perform its obligations under the Letter
Agreement, (ii) a material adverse effect on the validity or enforceability of
the Letter Agreement, or (iii) a material adverse effect on the business,
financial condition, operations, assets or properties of the Adviser.
"Advisory Agreement" means the Investment Advisory Agreement dated as of
May 31, 1997 between the Adviser and the Borrower, as the same may be amended,
supplemented, waived or modified as permitted under this Agreement.
"Affected Person" means each Lender, each Secondary Lender, or any other
entity which enters into a commitment to make or purchase Advances or any
interest therein, or to provide any liquidity or credit enhancement to a Conduit
Lender, and any of their respective Affiliates, including any assignee or
participant of any Lender or Secondary Lender.
"Affiliate" means, in respect of a referenced Person, another Person
controlling, controlled by or under common control with such referenced Person
(which in the case of the Conduit Lenders and the Program Agent shall also
include any entity which is a special purpose entity that issues commercial
paper notes and has a relationship to the Program Agent comparable to that of
the Conduit Lenders). The terms "control," "controlling," "controlled" and
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the like mean the direct or indirect possession of the power to direct or cause
the direction of the management or policies of a Person or the disposition of
its assets or properties, whether through ownership, by contract, arrangement or
understanding, or otherwise.
"Aggregate Custodian's Advance Amount" means the sum of (i) the aggregate
unpaid Dollar amount of all outstanding Custodian's Overdraft Advances of cash,
(ii) the aggregate Value of all Custodian's Overdraft Advances of assets (other
than cash) to the extent not reimbursed by the Borrower, and (iii) the accrued
and unpaid interest, if any, on the amounts set forth above.
"Agreement" means this Amended and Restated Revolving Credit and Security
Agreement, as the same may from time to time be amended, supplemented, waived or
modified.
"Agreement of Amendment" means the Agreement of Amendment dated as of the
date hereof among the Borrower, the Program Agent, the Custodian and the
Adviser.
"Alternate Base Rate" means in respect of any Advance for any Settlement
Period, a fluctuating interest rate per annum as shall be in effect from time to
time, which rate shall be at all times equal to the applicable Base Rate for
such Advance.
"Applicable Law" means any Law of any Authority, including, without
limitation, all Federal and state banking or securities laws, to which the
Person in question is subject or by which it or any of its property is bound.
"Applicable Margin" means, with respect to the Eurodollar Rate, 1.00% per
annum.
"Asset Coverage Test" means, as of any Determination Date, the Borrower's
"senior securities representing indebtedness" (as defined in Section 18(g) of
the Investment Company Act) have "asset coverage" (as defined in Section 18(h)
of the Investment Company Act) of at least 400% (computed on such Determination
Date regardless of whether or not dividends or distributions are being made on
such Determination Date, or whether Debt is being incurred on such Determination
Date and computed as if each outstanding Advance constituted a "senior security"
without regard to whether such Advance is a loan for "temporary purposes" or
otherwise excludable from the definition of "senior securities" under Section
18(g) of the Investment Company Act).
"Asset Purchase Agreement" means the Third Amended and Restated Asset
Purchase Agreement dated as of the date hereof entered into among the Program
Agent, the Conduit Lenders and each Secondary Lender, as purchaser, in
connection with this Agreement, as the same may be from time to time amended,
supplemented, waived or modified.
"Assets" means a collective reference to all items which would be
classified as an "asset" on the balance sheet of the Borrower in accordance with
GAAP.
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"Asset Value" means, as of any day of determination (a) in respect of Cash,
the amount of such Cash, and (b) in respect of any other Asset, the Value of
such Asset computed in the manner as such Value is required to be computed by
the Borrower in accordance with the rules, regulations and interpretations of
the SEC under the Investment Company Act; provided, that the Asset Value of any
Asset shall be net of the Borrower's liabilities relating thereto, including
without limitation all of the Borrower's obligations to pay any unpaid portion
of the purchase price therefor; provided, further, that for any Asset for which
independent reliable market quotations (which may consist of only an independent
dealer quotation) are not available (or which is not otherwise valued for the
Borrower by an independent recognized pricing source), the Asset Value of such
Asset shall be deemed zero for purposes of this definition.
"Assignee Rate" means in respect of any Advance by a Secondary Lender or
acquired by a Lender (other than a Conduit Lender) for any Settlement Period an
interest rate per annum equal to the sum of the Applicable Margin plus the
Eurodollar Rate for such Settlement Period; provided, however, that in case of:
(i) any Settlement Period on or prior to the first day of which the
applicable Lender (other than a Conduit Lender) or the applicable Secondary
Lender shall have notified the Program Agent that the introduction of or
any change in or in the interpretation of any law or regulation makes it
unlawful, or any central bank or other governmental authority asserts that
it is unlawful, for such Lender or such Secondary Lender to fund such
Advance at the Assignee Rate set forth above (and such Lender or such
Secondary Lender shall not have subsequently notified the Program Agent
that such circumstances no longer exist),
(ii) any Settlement Period of one to (and including) 27 days,
(iii) any Settlement Period as to which the Program Agent does not
receive notice, by no later than 11:00 a.m. (Chicago time) on the second
Business Day preceding the first day of such Settlement Period, that such
Advance will not be funded by issuance of commercial paper, or
(iv) any Settlement Period for which the aggregate principal amount of
all outstanding Advances is less than $1,000,000,
the "Assignee Rate" for such Settlement Period shall be an interest rate per
annum equal to the applicable Alternate Base Rate in effect on the first day of
such Settlement Period.
"Assignment and Acceptance" means the Assignment and Acceptance, in
substantially the form of Exhibit C hereto, entered into by a Secondary Lender,
an Eligible Assignee, the Program Agent and, if required by the terms of Section
9.06(b), the Borrower, pursuant to which such Eligible Assignee may become a
party to this Agreement.
"Authority" means any governmental or quasi-governmental authority
(including the National Association of Securities Dealers, the stock exchanges
and the SEC), whether
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executive, legislative, judicial, administrative or other, or any combination
thereof, including, without limitation, any Federal, state, territorial, county,
municipal or other government or governmental or quasi-governmental agency,
arbitrator, board, body, branch, bureau, commission, corporation, court,
department, instrumentality, master, mediator, panel, referee, system or other
political unit or subdivision or other entity of any of the foregoing, whether
domestic or foreign, having the force of law.
"Base Rate" means the rate of interest from time to time announced publicly
by JPMorgan in Chicago, Illinois as JPMorgan's base rate. The Base Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer of JPMorgan.
"Benefit Arrangement" means an employee benefit plan within the meaning of
Section 3(3) of ERISA which is subject to the provisions of Title I of ERISA and
is not a Plan or a Multiemployer Plan and which is maintained or otherwise
contributed to by any member of the ERISA Group.
"Borrower" shall have the meaning assigned to such term in the introduction
to this Agreement.
"Borrower Obligations" means all indebtedness, whether absolute, fixed or
contingent, at any time or from time to time owing by the Borrower to any
Secured Party under or in connection with this Agreement, the Advance Notes, the
Control Agreement or any other Program Document, including without limitation,
all amounts payable by the Borrower in respect of the Advances, with interest
thereon, and the amounts payable under Sections 2.05, 2.06, 2.07, 2.08, 2.09,
2.11, 2.12, 2.13, 7.04(b), 9.03 and 9.04 of this Agreement. For the avoidance of
doubt, Borrower Obligations do not include indebtedness owing by the Borrower to
State Street Bank and Trust Company in its capacity as Custodian. "Borrower's
Account" means the account of the Borrower (Account No. ▇▇▇▇▇▇▇▇, ABA No.
011-000-028) maintained with the Custodian or such other account as the Borrower
shall from time to time designate in writing to the Program Agent.
"Borrowing Base" means on the date any determination thereof is made, an
amount equal to (i) the aggregate Adjusted Asset Value of all Eligible
Collateral as of such date of determination minus (ii) the Borrowing Base Excess
Amount as of such date of determination.
"Borrowing Base Eligible Asset" means Cash, any Eligible Loan Asset, any
Eligible Commercial Paper Note and any Eligible Government Security which the
Borrower is permitted to purchase in accordance with the Investment Policies and
Restrictions which are free and clear of all Adverse Claims; provided, that such
Asset does not constitute (i) a Derivative Transaction, Modified Margin Stock,
an Equity Security, a Non-OECD Loan Asset, a Foreign Security System Asset or a
Foreign Currency Asset, (ii) an Asset which is the subject of a reverse
repurchase agreement, dollar roll, securities lending transaction or other
Derivatives
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Transaction (other than Derivatives Transactions entered into solely to protect
against interest rate risk which have not been entered into for speculative
purposes), including, without limitation, any cash or other Asset maintained in
a segregated account with the Custodian relating to any outstanding reverse
repurchase agreement entered into by the Borrower; or (iii) an Asset held by a
sub-custodian of the Custodian which is not located in the United States.
"Borrowing Base Excess Amount" means as of any date any determination
thereof is made, an amount equal to the sum (without duplication) of:
(i) the amount by which the aggregate Adjusted Asset Value of all
Eligible Collateral (other than Cash and Eligible Government Securities)
issued or Guaranteed by any Person (together with all Affiliates of such
Person), exceeds five percent (5%) of the aggregate Adjusted Asset Value of
all Eligible Collateral;
(ii) the amount by which the aggregate Adjusted Asset Value of all
Eligible Collateral issued or Guaranteed by Persons in a single Industry
Class, exceeds twenty percent (20%) of the aggregate Adjusted Asset Value
of all Eligible Collateral;
(iii) the amount by which the aggregate Adjusted Asset Value of all
Eligible Collateral which constitute Foreign Loan Assets exceeds twenty
percent (20%) of the aggregate Adjusted Asset Value of all Eligible
Collateral;
(iv) the amount by which the aggregate Adjusted Asset Value of all
Eligible Collateral which constitute Foreign Loan Assets relating to
Obligors in any single OECD Country (other than the United States) exceeds
ten percent (10%) of the aggregate Adjusted Asset Value of all Eligible
Collateral;
(v) the amount by which the aggregate Adjusted Asset Value of all
Eligible Collateral which constitutes Distressed Loan Assets exceeds ten
percent (10%) of the aggregate Adjusted Asset Value of all Eligible
Collateral;
(vi)the amount by which the aggregate Adjusted Asset Value of all Loan
Assets which constitute Eligible Collateral which have a scheduled final
maturity date later than the tenth (10th) anniversary of the Origination
Date of such Loan Assets, exceeds ten percent (10%) of the aggregate
Adjusted Asset Value of all Eligible Collateral;
(vii) the amount by which the aggregate Adjusted Asset Value of all
Loan Assets which constitute Eligible Collateral which constitute
participation interests purchased or otherwise acquired from any Selling
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Institution (together with all Affiliates of such Selling Institution),
exceeds ten percent (10%) of the aggregate Adjusted Asset Value of all
Eligible Collateral;
(viii) the amount by which the aggregate Adjusted Asset Value of all
Eligible Collateral which constitutes Unsecured Loan Assets exceeds fifteen
percent (15%) of the aggregate Adjusted Asset Value of all Eligible
Collateral;
(ix) the amount by which the aggregate Adjusted Asset Value of all
Eligible Collateral which constitutes Loan Assets in respect of which the
interest payable on the principal amount thereof is not calculated by
reference to a Floating Rate, exceeds ten percent (10%) of the aggregate
Adjusted Asset Value of all Eligible Collateral; and
(x) the aggregate maximum commitments of the Borrower to fund future
advances or extensions of credit under the Loan Documents relating to the
Pledged Collateral.
"Borrowing Base Test" means as of any Determination Date, that the
Borrowing Base shall be equal to or greater than Credits Outstanding.
"Borrowing Date" shall have the meaning assigned to such term in Section
2.02.
"Business Day" means any day on which (i) banks are not authorized or
required to close in Chicago, Illinois and the New York Stock Exchange is not
authorized or required to close, and (ii) if this definition of "Business Day"
is utilized in connection with a Eurodollar Rate Advance, dealings are carried
out in the London interbank market.
"Cash" means a demand deposit of United States Dollars immediately
available on the day in question in an account maintained by the Custodian.
"Class A Loan Asset" means as of any date of determination, a Borrowing
Base Eligible Asset which (i) is a Loan Asset, (ii) is not a Distressed Loan
Asset, and (iii) has an Asset Value which is at least ninety percent (90%) of
its par value as of such date of determination.
"Class B Loan Asset" means as of any date of determination, a Borrowing
Base Eligible Asset which (i) is a Loan Asset, (ii) is not a Distressed Loan
Asset, and (iii) has an Asset Value which is less than ninety percent (90%) of
its par value as of such date of determination.
"Class C Loan Asset" means as of any date of determination, a Borrowing
Base Eligible Asset which (i) is a Distressed Loan Asset, and (ii) has an Asset
Value which is at least ninety percent (90%) of its par value as of such date of
determination.
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"Class D Loan Asset" means as of any date of determination, a Borrowing
Base Eligible Asset which (i) is a Distressed Loan Asset, and (ii) has an Asset
Value which is less than ninety percent (90%) of its par value as of such date
of determination.
"Closing Date" means the first date on which the conditions precedent
specified in Section 3.01 shall have been fully satisfied.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor statute.
"Collateral Account" means account number BO041427, ABA Number ▇▇▇-▇▇▇-▇▇▇
and account number JL20, ABA Number ▇▇▇-▇▇▇-▇▇▇ established at State Street Bank
and Trust Company each entitled "VKSLF-JPMorgan as Secured Party".
"Compliance Certification Date" shall have the meaning assigned to such
term in Section 2.05(b).
"Conduit Lenders" means each of Falcon Asset Securitization Company LLC and
Chariot Funding LLC, together with their respective successors and assigns that
constitute special purpose entities managed by JPMorgan that issue commercial
paper notes.
"Control Agreement" means the Control and Collateral Agency Agreement,
dated as of November 17, 2003 among the Borrower, the Program Agent and the
Custodian, as the same may from time to time be amended, supplemented, waived or
modified.
"CP Rate" for each day during a Settlement Period for any Advance means to
the extent a Conduit Lender funds such Advance on such day, the per annum rate
notified by such Conduit Lender to the Program Agent for such Advance, which
rate shall (a) reflect the actual cost of funds to such Conduit Lender of making
and maintaining such Advance on such day, including fees payable by or on behalf
of such Conduit Lender to any dealer or placement agent in respect of commercial
paper notes issued by such Conduit Lender to fund such Advance, and (b) be
calculated in the manner in which such Conduit Lender typically calculates its
cost of funds in similar transactions; provided, however, that if any component
of such rate is a discount rate, in calculating the "CP Rate" for such day, the
Program Agent shall for such component use the rate resulting from converting
such discount rate to an interest bearing equivalent rate per annum.
"Credits Outstanding" means at any time a determination thereof is made, an
amount equal to the sum of (i) the outstanding principal amount of all Advances,
plus (ii) the Yield that would accrue on the aggregate outstanding principal
amount of the Advances through the sixty (60) day period following such date of
determination, computed by reference to the Assignee Rate based upon the
applicable Eurodollar Rates for a thirty (30) day period in effect as of the
time of determination, plus (iii) the Aggregate Custodian's Advance Amount.
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"Custodial Agreement" means the Custodian Contract dated as of August 1,
1997 between the Borrower and the Custodian, as the same may from time to time
be amended, supplemented, waived or modified as permitted under the Program
Documents.
"Custodian" means State Street Bank and Trust Company, as custodian,
securities intermediary and collateral agent under the Custodial Agreement and
the Control Agreement, and its permitted successors and assigns.
"Custodian's Overdraft Advances" means any advance of cash, assets or
securities by the Custodian to or for the benefit of the Borrower pursuant to or
in connection with the Custodial Agreement.
"Debt" means with respect to any Person, at any date, without duplication,
(i) all "senior securities representing indebtedness" (as defined in Section
18(g) of the Investment Company Act), (ii) all obligations of such Person for
borrowed money, including without limitation, all obligations of such Person
which are evidenced by letters of credit or letter of credit reimbursement,
(iii) all obligations of such Person evidenced by bonds, debentures, notes,
acceptances or other similar instruments, (iv) all obligations of such Person to
pay the deferred purchase price of property or services, (v) all obligations of
such Person as lessee which are capitalized in accordance with GAAP, (vi) all
Debt of others secured by a Lien on any asset of such Person, whether or not
such Debt is assumed by such Person, (vii) payment obligations, fixed or
contingent, under investment, financial derivative or similar contracts (other
than covered short sales), (viii) all Debt of others Guaranteed by such Person,
and (ix) to the extent not otherwise included, all items which in accordance
with GAAP would be included in determining total liabilities as shown on the
liabilities side of such Person's balance sheet.
"Default" means any event which, with the passage of time, the giving of
notice, or both, would constitute an Event of Default.
"Defaulting Banks" means any Secondary Lender that (i) defaults in its
obligation to make any Advance pursuant to Section 2.02, or (ii) in its capacity
as a purchaser under the Asset Purchase Agreement, defaults in its obligation to
purchase any interest in any Advance under the Asset Purchase Agreement.
"Derivatives Transaction" means any financial futures contract, option,
forward contract, warrant, swap, swaption, collar, floor, cap and other
agreement, instrument and derivative and other transactions of a similar nature
(whether currency linked, index linked, insurance risk linked, credit risk
linked or otherwise).
"Determination Date" means (i) each Borrowing Date, (ii) each Weekly
Determination Date, (iii) each date any Restricted Payment is made or any
Permitted Senior Security is issued, and (iv) during the continuance of an Event
of Default, each Business Day which the Program Agent may, or upon the direction
of the Majority Banks, shall, designate as a "Determination Date" (which may be
daily).
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"Distressed Loan Asset" means a Loan Asset (i) the Obligor of which is the
subject of a bankruptcy, insolvency, liquidation or other similar proceedings,
(ii) which is in default (unless cured or waived) beyond the applicable grace
periods, if any, as to payment of principal or interest or other amount owing
under the applicable Loan Documents; provided, however, that if such Loan Asset
is past due as to the payment of principal or interest or otherwise for a period
of time equal to or greater than forty-five (45) consecutive days, such Loan
Asset shall be deemed to constitute a Distressed Loan Asset regardless of
whether or not the applicable grace period in respect of such Loan Asset has
expired, (iii) which is otherwise classified by the Adviser or the Borrower as
"non-performing", (iv) in respect of which the related Obligor is rated "Caa" or
lower by Moody's or "CCC" or lower by S&P or which, if unrated, are in the
reasonable judgment of the Adviser, of equivalent credit quality, (v) which is
not part of a senior credit facility, or (vi) which is otherwise not classified
as a "Senior Loan" by the Adviser.
"Dollars" and "$" mean lawful money of the United States of America.
"Eligible Assignee" means JPMorgan, any of its Affiliates, any Person
managed by JPMorgan or any of their respective Affiliates, or any financial or
other institution acceptable to the Program Agent.
"Eligible Collateral" means at any time the Pledged Collateral which
constitutes Borrowing Base Eligible Assets.
"Eligible Commercial Paper Note" means a promissory note issued in the
commercial paper market by an obligor having its principal office in the United
States, having a maturity of not more than 270 days and which (i) if rated by
both S&P and ▇▇▇▇▇'▇ is rated at least "A-1" by S&P and at least "P-1" by
Moody's, and (ii) if rated by S&P or Moody's (but not both), is rated at least
"A-1" by S&P or at least "P-1" by Moody's.
"Eligible Government Securities" means all "Government Securities" (as
defined in the Investment Company Act and which for the purposes hereof shall
include any securities issued or guaranteed as to principal and interest by an
agency of the government of the United States) held in an account maintained by
the Custodian.
"Eligible Loan Asset" at any time means a Loan Asset:
(i) with respect to which the interest payable on the principal amount
thereof by the related Obligor is payable in cash;
(ii) in respect of which the Borrower's interest is not a
subparticipation;
(iii) which has a scheduled final maturity date no later than the
twelfth (12th) anniversary after the related Origination Date;
10
(iv) which is part of a senior credit facility, with respect to which
such Loan Asset is not by its terms subordinated (pursuant to contractual
provisions or otherwise) to the prior payment of any other liabilities or
any equity interests of the related Obligor;
(v) which is part of a syndicated credit facility where the sum of the
aggregate revolving loan commitment amount plus the aggregate outstanding
principal amount of all loans under such facility on the Origination Date
of such Loan Asset is at least equal to $100,000,000;
(vi) which relates to Loan Documents in which the Borrower's interest
(direct or participating) in the aggregate outstanding principal amount of
all loans thereunder is no greater than thirty-three and one-third percent
(33.33%);
(vii) in respect of which the related Loan Documents are not subject
to any confidentiality arrangement which would preclude the Program Agent
from reviewing such Loan Documents;
(viii) in which the Borrower's interest in all collateral security
therefor and principal and interest payments thereunder is no less than pro
rata and pari passu with all other lenders thereunder or participants
therein, as the case may be;
(ix) in respect of which the credit rating of the related Transaction
Agent or its controlling Affiliate is no less than "A-" from S&P or "A3"
from Moody's;
(x) in respect of which, if the Borrower's interest therein is that of
a participant, the credit rating of the related Selling Institution is no
less than "A-" from S&P and "A3" from Moody's; and
(xi) the pledge of which under Article VII of this Agreement, would
not conflict with or constitute a default under or be prohibited by any
anti-assignment or other provisions contained in the related Loan
Documents, except for anti-assignment provisions rendered ineffective by
applicable law.
"E-Mail Report" shall have the meaning assigned to such term in Section
9.15.
"Equity Securities" means common and preferred stock, warrants, membership
interests or partnership interests and securities that are convertible into
common or preferred stock, membership interests or partnership interests,
including without limitation common stock purchase warrants and rights, equity
interests in trusts, partnerships, limited liability companies, joint ventures
or similar enterprises.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
11
"ERISA Group" means the Borrower and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower, are treated as a single
employer under Section 414(b), (c), (m) or (n) of the Code.
"Eurocurrency Liabilities" shall have the meaning assigned to such term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"Eurodollar Additional Yield" means additional Yield on the outstanding
principal of each Advance during the Settlement Period in respect of such
Advance in respect of which Yield is computed by reference to the Eurodollar
Rate, for such Settlement Period, at a rate per annum equal at all times during
such Settlement Period to the remainder obtained by subtracting (i) the
Eurodollar Rate for such Settlement Period from (ii) the rate obtained by
dividing such Eurodollar Rate referred to in clause (i) above by that percentage
equal to one-hundred percent (100%) minus the Eurodollar Rate Reserve Percentage
of the applicable Lender (other than the Conduit Lenders) or Secondary Lender
for such Settlement Period.
"Eurodollar Rate" means, in respect of any Advance for any Settlement
Period, an interest rate per annum equal to the rate per annum at which deposits
in Dollars are offered by the principal office of JPMorgan in London, England to
prime banks in the London interbank market at 11:00 A.M. (London time) two (2)
Business Days before the first day of such Settlement Period in an amount
substantially equal to the outstanding principal amount of such Advance on such
first day and for a period equal to such Settlement Period.
"Eurodollar Rate Advance" means an Advance the Yield on which is computed
with reference to the Eurodollar Rate.
"Eurodollar Rate Reserve Percentage" for any Settlement Period for any
Eurodollar Rate Advance means the reserve percentage applicable during such
Settlement Period under regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any successor) (or if more than one
such percentage shall be applicable, the daily average of such percentages for
those days in such Settlement Period during which any such percentage shall be
so applicable) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal reserve
requirement) for any applicable Lender (other than the Conduit Lenders) or
Secondary Lender with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or any other category of liabilities that
includes deposits by reference to which the interest rate on Eurocurrency
Liabilities is determined) having a term comparable to such Settlement Period.
"Event of Default" means any of the events, acts or occurrences set forth
in Section 6.01.
12
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC thereunder, all as from time to time in
effect, or any successor law, rules or regulations, and any reference to any
statutory or regulatory provision shall be deemed to be a reference to any
successor statutory or regulatory provision.
"Facility" shall have the meaning assigned to such term in Section 9.09.
"Fee Letter" means that certain amended and restated letter agreement dated
the date hereof between the Borrower and the Program Agent, as the same may from
time to time be amended, supplemented, waived or modified.
"Floating Rate" means an interest rate calculated by reference to the prime
rate, the London interbank offered rate, the certificate of deposit rate, the
federal funds rate or any other per annum rate commonly referred to in the
United States banking industry as a "floating rate".
"Foreign Currency Asset" means any Asset which is denominated or payable in
a currency other than Dollars.
"Foreign Loan Asset" means any Loan Asset the Obligor of which is organized
under the laws of any OECD Country (other than the United States of America).
"Foreign Security System Asset" shall have the meaning assigned to such
term in Section 3(a) of the Control Agreement.
"GAAP" means generally accepted accounting principles in the United States,
in effect from time to time.
"Governmental Authorizations" means all franchises, permits, licenses,
approvals, consents and other authorizations of all Authorities.
"Governmental Filings" means all filings, including franchise and similar
tax filings, and the payment of all fees, assessments, interests and penalties
associated with such filing with all Authorities.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt or other obligation of
any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of partnership arrangements,
or by agreement to keep-well, to purchase assets, goods, securities or services,
to take-or-pay, or to maintain financial statement conditions or otherwise) or
(ii) entered into for the purpose of assuring in any other manner the obligee of
such Debt or other obligation of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part); provided, that the term
"Guarantee" shall not include endorsements for collection or deposit in
13
the ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Indemnified Party" shall have the meaning assigned to such term in Section
9.04(b).
"Industry Class" means, for purposes of computing the Borrowing Base, each
industry class as determined by applying, in separate tests, the classification
categories provided by Moody's, or, in the event that Moody's does not classify
a particular Person, as classified by the Adviser based upon the Moody's
industry classifications.
"Investment Company Act" means the Investment Company Act of 1940, as
amended, and the rules and regulations of the SEC thereunder, as modified or
interpreted by orders of the SEC, or other interpretative releases or letters
issued by the SEC or its staff, all as from time to time in effect, or any
successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
"Investment Policies and Restrictions" means the provisions dealing with
investment policies, distributions, investment restrictions, tender offers,
repurchases, leverage and diversification status as set forth in the Prospectus,
as modified in accordance with Section 5.02(i).
"Investor Report" means the Investor Report of the Borrower substantially
in the form of Schedule I hereto.
"▇▇ ▇▇▇▇▇▇" means JPMorgan Chase Bank, N.A. and its successors.
"Law" means any action, code, consent decree, constitution, decree,
directive, enactment, finding, guideline, law, injunction, interpretation,
judgment, order, ordinance, policy statement, proclamation, promulgation,
regulation, requirement, rule, rule of law, rule of public policy, settlement
agreement, statute, or writ, of any Authority, or any particular section, part
or provision thereof.
"Lender" means the Conduit Lenders, together with all Persons which acquire
or are obligated to acquire any interest in any Advance from the Conduit Lenders
under an Asset Purchase Agreement or under any similar arrangement.
"Letter Agreement" means the Letter Agreement dated as of November 17, 2003
from the Adviser to the Program Agent on behalf of the Secured Parties, as the
same may from time to time be amended, supplemented, waived or modified.
"Leverage Purposes" means for the purpose of (i) purchasing Assets, (ii)
paying principal and Yield in respect of outstanding Advances, or (iii) for
general corporate purposes.
14
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien or security interest (statutory or other), or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement) and any financing lease having
substantially the same economic effect as any of the foregoing.
"Liquidation Fee" means, in respect of any Advance for any Settlement
Period which is funded by a Conduit Lender during which the principal on such
Advance is repaid by the Borrower in whole or in part, upon less than two (2)
Business Days prior written notice of such repayment, prior to the end of said
Settlement Period, the amount, if any, by which (i) the additional Yield
(calculated without taking into account any Liquidation Fee or any shortened
duration of such Settlement Period) which would have accrued during such
Settlement Period on the reduction of the outstanding principal amount of such
Advance relating to such Settlement Period had such reductions remained as
outstanding principal, exceeds (ii) that income, if any, received by such
Conduit Lender's investing the proceeds of such reductions of principal.
"Loan Asset" means a direct or participation or subparticipation interest
in or assignment or novation of a loan or other extension of credit.
"Loan Documents" means with respect to any Loan Asset, each loan agreement,
promissory note, collateral security agreement, participation certificate,
guarantee and any other agreement or document evidencing, securing, governing or
executed in connection with such Loan Asset, including without limitation, the
agreements and instruments in respect of which the Borrower acquired such Loan
Asset.
"Majority Banks" means, as of any determination date (i) if on such
determination date, any Secondary Lender in its capacity as a purchaser under
the Asset Purchase Agreement has a commitment to purchase additional interests
in Advances from a Conduit Lender under the Asset Purchase Agreement, such
Secondary Lenders whose Commitments (as defined in the Asset Purchase Agreement)
aggregate in excess of fifty percent (50%) of the aggregate Commitments under
the Asset Purchase Agreement; provided, that, the Commitments of any Defaulting
Bank shall be excluded from the computation of Majority Banks, (ii) if on such
determination date no Secondary Lender in its capacity as a purchaser under the
Asset Purchase Agreement has any commitment to purchase additional interests in
Advances from a Conduit Lender under the Asset Purchase Agreement, the Persons
with Advances, the outstanding principal amount of which exceeds fifty percent
(50%) of the outstanding principal amount of all Advances; provided, that if on
any determination date there are multiple Secondary Lenders which are not
Defaulting Banks and the Majority Banks on such determination date as determined
by clause (i) or clause (ii) above, as applicable, is a single entity (for such
purpose treating JPMorgan and the Conduit Lenders (if the Conduit Lenders are
administered by JPMorgan) as a single entity) (the "Controlling Bank"), then the
term "Majority Banks" shall be deemed to mean such Controlling Bank and at least
one other Secondary Lender which is not a Defaulting Bank.
15
"Margin Stock" shall have the meaning assigned to such term in Regulation
U.
"Material Adverse Effect" means a (i) material adverse effect on the
ability of the Borrower to perform its obligations under this Agreement or the
Control Agreement or to perform any material obligation under any other Program
Document to which it is a party or any Loan Document, (ii) a material adverse
effect on any Secured Party's right, title and interest in the Pledged
Collateral or on the rights and remedies of any Secured Party under any Program
Document, (iii) a material adverse effect on the validity or enforceability of
this Agreement or any other Program Document to which the Borrower is a party or
any Loan Document, (iv) a material adverse effect on the business, financial
condition, operations, Assets or properties of the Borrower, (v) a material
Adverse Claim on any of the Assets of the Borrower, or (vi) a Default or Event
of Default.
"Maturity Date" means (1) in respect of any Advance designated by the
Borrower in the Notice of Borrowing delivered in connection with such Advance to
be used solely for Short-Term Purposes, the earlier of (i) the date which is
sixty (60) days following the Borrowing Date of such Advance (or if such day is
not a Business Day, the Business Day immediately preceding such date), and (ii)
the Termination Date (or if such day is not a Business Day, the Business Day
immediately preceding such date), or (2) with respect to any Advance designated
by the Borrower in the Notice of Borrowing delivered in connection with such
Advance to be used solely for Leverage Purposes, the earlier of (i) the date
which is one (1) year following the Borrowing Date of such Advance (or if such
day is not a Business Day, the Business Day immediately preceding such date),
and (ii) the Termination Date (or if such day is not a Business Day, the
Business Day immediately preceding such date).
"Modified Margin Stock" shall mean "Margin Stock" as defined in Regulation
U (without giving effect to the exclusions from such definition in clauses
(5)(i) through (5)(iv) thereof).
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., together with its
successors.
"Multiemployer Plan" means an employee pension benefit plan within the
meaning of Section 4001(a)(3) of ERISA.
"Non-Funding Notice" shall have the meaning assigned to such term in
Section 2.02.
"Non-OECD Loan Asset" means any Loan Asset the Obligor of which is
organized outside of any OECD Country.
"Notice of Borrowing" shall have the meaning assigned to such term in
Section 2.02.
"Notice of Exclusive Control" shall have the meaning assigned to such term
in the Control Agreement.
16
"Obligor" means in respect of any Loan Asset, the Person primarily
obligated under the related Loan Documents to repay the loan or extension of
credit which is the subject of such Loan Asset.
"OECD Country" means any country which is a member of the Organization for
Economic Cooperation and Development and which has a sovereign credit rating for
"foreign currency" of at least "AA-" and "Aa3" from S&P and Moody's,
respectively.
"Origination Date" means in respect of any Loan Asset the initial date on
which the proceeds of the loan or other extension of credit which is the subject
of such Loan Asset was advanced to the Obligor under the related Loan Documents.
"Other Taxes" shall have the meaning assigned to such term in Section
9.03(b).
"Parent" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., together with its successors.
"Permitted Debt" means (i) Debt arising under this Agreement or the other
Program Documents to the Secured Parties, (ii) Debt in favor of the Custodian
relating to Custodian's Overdraft Advances incurred in the ordinary course of
the Borrower's business, which are not overdue and which do not exceed the
amount permitted by Section 5.02(o), (iii) fee and expense obligations to the
Custodian and other similar agents which are providing services in respect of
the Borrower's Assets arising in the ordinary course of the Borrower's business
which are not overdue for a period in excess of thirty (30) days, (iv) Debt
(other than Debt for borrowed money) arising in connection with transactions in
the ordinary course of the Borrower's business in connection with its purchasing
of securities, Derivatives Transactions or dollar rolls to the extent such
transactions are permitted under the Investment Company Act and the Investment
Policies and Restrictions, (v) obligations of the Borrower to fund future
extensions of credit under the Loan Documents relating to its Loan Assets which
do not exceed twenty percent (20%) of the aggregate Asset Value of the
Borrower's Assets and which meet the Borrower's diversification requirements set
forth in the Prospectus, which are not overdue, (vi) Debt representing accrued
expenses and current trade account payables incurred in the ordinary course of
the Borrower's business which are not overdue for a period beyond the customary
practices in the industry or which are being diligently contested in good faith,
(vii) Debt in respect of judgments or awards that have been in force for less
than the applicable period for taking an appeal so long as such judgments or
awards do not constitute an Event of Default and so long as execution is not
levied thereunder or in respect of which the Borrower (A) shall at the time in
good faith be diligently prosecuting an appeal or proceeding for review and in
respect of which a stay of execution shall have been obtained pending such
appeal or review, or (B) shall have obtained an unsecured performance bond in
respect of such judgment or award, and (viii) Debt arising in connection with
reverse repurchase agreements which are permitted under the Investment Company
Act and the Investment Policies and Restrictions and which have been entered
into in the ordinary course of the Borrower's business.
17
"Permitted Liens" means (a) in respect of any Asset of the Borrower, (i)
Liens of any Secured Party created by or pursuant to this Agreement or the
Control Agreement, (ii) Liens of the Custodian securing the Custodian's
Overdraft Advances to the extent such Custodian's Overdraft Advances do not
exceed the amount permitted by Section 5.02(o), (iii) Liens of the Custodian
which are by the terms of the Control Agreement expressly subordinated to the
payment of the Borrower Obligations, and (iv) Liens (other than non-possessory
Liens which pursuant to applicable law are, or may be, entitled to take priority
(in whole or in part) over prior, perfected liens and security interests) with
respect to taxes, assessments and other governmental charges or levies for
amounts not yet due or which are being contested in good faith by appropriate
proceedings diligently conducted and with respect to which adequate reserves
have been set aside in accordance with GAAP, provided that enforcement of such
Liens is stayed pending such contest, and (b) in respect of any Asset of the
Borrower other than any Pledged Collateral (i) Liens incidental to the conduct
of the Borrower's business securing the performance of fee and expense
obligations to the Custodian and other similar agents which are providing
services in respect of the Borrower's Assets arising in the ordinary course of
the Borrower's business which are not overdue for a period in excess of thirty
(30) days, and (ii) Liens in respect of Debt permitted under clauses (iv) and
(viii) of the definition of Permitted Debt.
"Permitted Senior Securities" means "senior securities" within the meaning
of the Investment Company Act which constitute Advances under this Agreement,
Derivatives Transactions, repurchase transactions, reverse repurchase
transactions, preferred shares or commitments of the Borrower to fund future
advances or other extensions of credit under any Loan Document, to the extent
the issuance of any such senior security by the Borrower is not in contravention
of the Investment Company Act or the Investment Policies and Restrictions.
"Person" means an individual or a corporation (including a business trust),
partnership, trust, incorporated or unincorporated association, joint stock
company, limited liability company, government (or an agency or political
subdivision thereof) or other entity of any kind.
"Plan" means an employee pension benefit plan (other than a Multiemployer
Plan) which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code.
"Pledged Collateral" shall have the meaning assigned to such term in
Section 7.01.
"Post-Default Rate" means in respect of all amounts payable to any Secured
Party under any Program Document not paid when due (whether at stated maturity,
by acceleration or otherwise), including, without limitation, the principal and
Yield on any Advance not paid when due, a rate per annum during the period
commencing on the due date until such amount is paid in full equal to the
applicable Base Rate as in effect from time to time plus two (2) percent (2%).
18
"Preliminary Borrowing Notice" shall have the meaning assigned to such term
in Section 2.02.
"Private Authorizations" means all franchises, permits, licenses,
approvals, consents and other authorizations of all Persons (other than
Authorities) including, without limitation, those with respect to trademarks,
service marks, trade names, copyrights, computer software programs, technical
and other know-how.
"Proceeds" shall have, with reference to any asset or property, the meaning
assigned to it under the UCC and, in any event, shall include, but not be
limited to, any and all amounts from time to time paid or payable under or in
connection with such asset or property.
"Product Information" shall have the meaning assigned to such term in
Section 9.09(a).
"Program Agent" shall have the meaning assigned to such term in the
introduction to this Agreement.
"Program Agent's Account" means the special account of the Conduit Lenders
(Account No. 51-14810, ABA No. ▇▇▇▇▇▇▇▇▇, Reference: VK Senior Loan Fund)
maintained at the principal office of JPMorgan or such account of the Program
Agent which the Program Agent has designated in writing to the other parties
hereto.
"Program Documents" means this Agreement, the Advance Notes, the Letter
Agreement, the Asset Purchase Agreement, the Control Agreement, Advisory
Agreement, the Custodial Agreement, the Fee Letter, the Loan Documents and the
other agreements, documents and instruments entered into or delivered in
connection herewith or therewith.
"Program Termination Date" means the later to occur of (i) the Termination
Date, and (ii) the date that all Borrower Obligations have been finally paid in
full; provided, however, that if any payment in respect of any Borrower
Obligation made to any Secured Party must be rescinded or returned for any
reason whatsoever (including the insolvency or bankruptcy of the Borrower) such
Borrower Obligation shall be deemed to be reinstated as though such payment had
not been made and the Program Termination Date shall be deemed to have not
occurred.
"Prospectus" means with respect to the Borrower the prospectus dated
November 30, 2005 filed with the SEC as a part of the Borrower's registration
statement on Form N-2, as amended (or any successor SEC form), and shall
include, without limitation, the related statement of additional information, if
any, included in such registration statement, and all supplements, amendments
and modifications thereto as of the Restatement Effective Date, and as further
supplemented, amended or modified in accordance with Applicable Law, including,
without limitation, the Securities Act and the Investment Company Act.
"Regulation T" means Regulation T of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
19
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Regulation X" means Regulation X of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Requested Amount" shall have the meaning assigned to such
term in Section 2.02.
"Responsible Officer" means in respect of any Person, the president, any
vice president, the chief financial officer, controller, treasurer or any
assistant treasurer; provided, that the Program Agent shall have received a
manually signed certificate of the Secretary or Assistant Secretary of such
Person as to the incumbency of, and bearing a manual specimen signature of, such
duly authorized officer.
"Restatement Effective Date" means the first date on which the conditions
precedent specified in Section 3.03 had been fully satisfied.
"Restricted Payments" means (a) the declaration of any distribution or
dividends (other than distributions payable solely in shares of beneficial
interest in the Borrower) on, or the payment on account of, or the setting apart
of assets for the purchase, redemption, retirement or other acquisition of, any
shares of beneficial interests in the Borrower, including, without limitation,
all common and preferred shares, whether now or hereafter outstanding, either
directly or indirectly, whether in cash, property or in obligations of the
Borrower, and (b) the payment of fees and expenses to the Adviser or any
Affiliate of the Adviser as compensation for the provision of managerial,
administrative services or otherwise.
"S&P" means Standard & Poor's Ratings Group, together with its successors.
"SEC" means the Securities and Exchange Commission or any other
governmental authority of the United States of America at the time
administrating the Securities Act, the Investment Company Act or the Exchange
Act.
"Secondary Lender Commitment" means (a) with respect to each Secondary
Lender party to this Agreement on the Restatement Effective Date, the amount set
forth on the signature page to this Agreement in respect of such Secondary
Lender, as such amount shall be adjusted by any Assignment and Acceptance
entered into between such Secondary Lender and an Eligible Assignee in
accordance with and subject to Section 9.06(b), or (b) with respect to a
Secondary Lender that has entered into an Assignment and Acceptance, the amount
set forth therein as such Secondary Lender's "Secondary Lender Commitment", in
each case as such amount may be reduced by an Assignment and Acceptance entered
into between such Secondary Lender and an Eligible Assignee in accordance with
and subject to Section 9.06(b), and as may be further reduced (or terminated)
pursuant to the next sentence. Any reduction (or termination) of the Total
Commitment pursuant to the terms of this Agreement shall reduce ratably (or
terminate) each Secondary Lender's Secondary Lender Commitment.
20
"Secondary Lender Percentage" of any Secondary Lender means, (a) with
respect to each Secondary Lender party to this Agreement on the Restatement
Effective Date, the percentage set forth on the signature page to this Agreement
in respect of such Secondary Lender, as such percentage shall be reduced by any
Assignment and Acceptance entered into by such Secondary Lender with an Eligible
Assignee in accordance with and subject to Section 9.06(b), or (b) with respect
to a Secondary Lender that has entered into an Assignment and Acceptance, the
percentage set forth therein as such Secondary Lender's Secondary Lender
Percentage, as such percentage shall be reduced by an Assignment and Acceptance
entered into between such Secondary Lender and an Eligible Assignee in
accordance with and subject to Section 9.06(b).
"Secondary Lender Stated Expiration Date" means July 13, 2007, unless,
prior to such date (or the date so extended pursuant to this clause), upon the
Borrower's request, made not more than sixty (60) days nor less than thirty (30)
days prior to the then current Secondary Lender Stated Expiration Date, one or
more Secondary Lenders having 100% of the Total Commitment shall in their sole
discretion consent, which consent shall be given not less than twenty (20) days
prior to the then current Secondary Lender Stated Expiration Date (the date any
such consent is given, the "Extension Date"), to the extension of the Secondary
Lender Stated Expiration Date to the date occurring 364 days after such
Extension Date; provided, however, that any failure of any Secondary Lender to
respond to the Borrower's request for such extension shall be deemed a denial of
such request by such Secondary Lender.
"Secondary Lenders" means JPMorgan, State Street Bank and Trust Company,
The Bank of New York, Lloyds TSB Bank plc (in their capacities as lenders under
this Agreement) and each Eligible Assignee that becomes a party to this
Agreement pursuant to and in accordance with the requirements of Section
9.06(b).
"Secured Parties" means the Program Agent, the Lenders, the Secondary
Lenders and their respective successors and assigns.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC thereunder, all as from time to time in effect,
or any successor law, rules or regulations, and any reference to any statutory
or regulatory provisions shall be deemed to be a reference to any successor
statutory or regulatory provision.
"Selling Institution" means in respect of any Loan Asset which constitutes
a participation interest, the Person which has granted or sold to the Borrower a
participation interest in the loan or other extension of credit which is the
subject of such Loan Asset.
"Settlement Date" means the date which is the twelfth (12th) day of each
calendar month, or if such day is not a Business Day, the next succeeding
Business Day; provided, that, for purposes of the payment of Yield, with respect
to any Settlement Period for which Yield is computed by reference to the
Eurodollar Rate, the Settlement Date shall be the last day of such Settlement
Period, or if such day is not a Business Day, the next succeeding Business Day.
21
"Settlement Period" means in respect of any Advance:
(a) in the case of any Settlement Period in respect of which Yield in
respect of such Advance is computed by reference to the CP Rate, the period
beginning on the date such Advance was made and ending on the last day of the
calendar month in which such Advance was made and thereafter each successive
period commencing on the first day of each calendar month during the term of
this Agreement and ending on the last day of such calendar month during the term
of this Agreement; provided, however, that in the case of any Settlement Period
for any Advance which commences before the Maturity Date for such Advance and
would otherwise end on a date occurring after such Maturity Date, such
Settlement Period shall end on such Maturity Date and the duration of each
Settlement Period which commences on or after the Maturity Date for such Advance
may be any period (including, without limitation, a period of one day) as shall
be selected from time to time by the Program Agent;
(b) in the case of any Settlement Period in respect of which Yield in
respect of such Advance is computed by reference to the Eurodollar Rate, the
period beginning on the date such Advance was made and ending on the last day of
the calendar month in which such Advance was made and thereafter each successive
period commencing on the first day of each calendar month during the term of
this Agreement and ending on the last day of such calendar month during the term
of this Agreement; provided, however, that any Settlement Period which is other
than the monthly Settlement Period shall be of such duration as shall be
selected by the Program Agent; and
(c) in the case of any Settlement Period in respect of which Yield is
computed by reference to the Alternate Base Rate, such Settlement Period shall
be of such duration as shall be selected by the Program Agent.
"Short-Term Purposes" means for the purpose of short-term liquidity and
other temporary emergency purposes, which purposes are permitted under and in
compliance with the Investment Company Act and by the Borrower's Prospectus.
"Specified Loan Documents" shall have the meaning assigned to such term in
the Control Agreement.
"Taxes" shall have the meaning assigned to such term in Section 9.03(a).
"Termination Date" means the earlier of (i) the Secondary Lender Stated
Expiration Date, and (ii) the date the Total Commitment shall terminate pursuant
to Section 2.10 or Section 6.01.
"Total Commitment" means $700,000,000, as such amount may be reduced
pursuant to Section 2.10. References to the unused portion of the Total
Commitment shall mean, at any time, the Total Commitment then in effect, minus
the outstanding principal amount of the Advances.
22
"Transaction Agent" means a commercial bank, insurance company, finance
company or other financial institution that is acting as agent or trustee under
the Loan Documents relating to any Loan Asset.
"UCC" means the Uniform Commercial Code, as from time to time in effect in
the applicable jurisdictions.
"Unsecured Loan Assets" means Loan Assets which are not fully secured under
the related Loan Documents by a first priority perfected Lien on assets or
properties of the related Obligor with value as reasonably determined by the
Adviser at the time of the Borrower's purchase of such Loan Asset in reliance
upon appraisals, financial statements or market valuation techniques, in an
amount no less than the outstanding debt of such Obligor under the related Loan
Documents.
"Value" shall have the meaning assigned to such term in Section 2(a)(41) of
the Investment Company Act.
"Weekly Determination Date" means the last Business Day of each calendar
week.
"Yield" means for each Advance for each Settlement Period:
(i) for each day during such Settlement Period to the extent such
Advance will be funded or maintained on such day by a Conduit Lender,
CPR x P + LF
------------
360
(ii)for each day during such Settlement Period to the extent such
Advance will be funded or maintained on such day by a Secondary Lender or a
Lender (other than a Conduit Lender),
AR x P
------
360
where:
AR = the applicable Assignee Rate for such Advance for
such Settlement Period
P = the outstanding principal amount of such Advance
on such day
23
CPR = the applicable CP Rate for such Advance on such day
LF = the Liquidation Fee, if any, for such Advance for
such Settlement Period (expressed as a daily
amount);
provided, further, that Yield for any Advance shall not be considered paid by
any distribution to the extent that at any time all or a portion of such
distribution is rescinded or must otherwise be returned for any reason.
SECTION 1.02. Rules of Construction.
For all purposes of this Agreement, except as otherwise expressly provided
or unless the context otherwise requires (i) singular words shall connote the
plural as well as the singular, and vice versa (except as indicated), as may be
appropriate, (ii) the words "herein," "hereof" and "hereunder" and other words
of similar import used in this Agreement refer to this Agreement as a whole and
not to any particular appendix, article, schedule, section, paragraph, clause,
exhibit or other subdivision, (iii) the headings, subheadings and table of
contents set forth in this Agreement are solely for convenience of reference and
shall not constitute a part of this Agreement nor shall they affect the meaning,
construction or effect of any provision hereof, (iv) references in this
Agreement to "including" shall mean including without limiting the generality of
any description preceding such term, and for purposes hereof the rule of ejusdem
generis shall not be applicable to limit a general statement, followed by or
referable to an enumeration of specific matters, to matters similar to those
specifically mentioned, and (v) each of the parties to this Agreement and its
counsel have reviewed and revised, or requested revisions to, this Agreement,
and the usual rule of construction that any ambiguities are to be resolved
against the drafting party shall be inapplicable in the construction and
interpretation of this Agreement.
SECTION 1.03. Computation of Time Periods.
Unless otherwise stated in this Agreement, in the computation of a period
of time from a specified date to a later specified date, the word "from" means
"from and including" and the words "to" and "until" both mean "to but
excluding".
ARTICLE II
ADVANCES TO THE BORROWER
SECTION 2.01. Advance Facility.
On the terms and conditions hereinafter set forth, including without
limitation, Sections 3.01, 3.02 and 3.03, each Conduit Lender may, in its sole
discretion, make an Advance to the Borrower on any Borrowing Date from the date
hereof to the Termination Date in an
24
amount equal to the Requested Amount. On the terms and conditions hereinafter
set forth, including without limitation, Sections 3.01, 3.02 and 3.03 and during
the period from the date hereof to the Termination Date if the Conduit Lenders
have declined to make Advances in the full Requested Amount, the Secondary
Lenders shall make Advances to the Borrower, ratably in accordance with their
respective Secondary Lender Percentages as provided in Section 2.02. Under no
circumstances shall any Conduit Lender or any Secondary Lender be obligated to
make any such Advance, to the extent that after giving effect to the making of
such Advance (i) the aggregate principal amount of all outstanding Advances
would exceed the Total Commitment, or (ii) the aggregate principal amount of all
outstanding Advances funded by any Secondary Lender under this Agreement and in
its capacity as a purchaser under the Asset Purchase Agreement would exceed such
Secondary Lender's Secondary Lender Commitment.
SECTION 2.02. Making of Advances.
If the Borrower desires to receive a borrowing under this Agreement it
shall (i) give the Program Agent written notice (each such notice a "Preliminary
Borrowing Notice") of such desire not later than 11:00 a.m. (Chicago time) on
the Business Day immediately preceding the proposed borrowing date of such
borrowing, which notice shall specify (x) the proposed borrowing date therefor
which shall be a Business Day (each such date, a "Borrowing Date"), and (y) the
aggregate principal amount of the proposed borrowing (the "Requested Amount"),
and (ii) no later than 7:00 a.m. (Chicago time) on the Borrowing Date specified
in the related Preliminary Borrowing Notice, confirm its desire to receive a
borrowing on such Borrowing Date by giving the Program Agent a final borrowing
notice in substantially the form of Exhibit B hereto (each such notice a "Notice
of Borrowing") which shall be signed by a Responsible Officer of the Borrower
and shall specify the Borrowing Date, the Requested Amount specified in the
related Preliminary Borrowing Notice, whether such Advance shall be used for
Short-Term Purposes or Leverage Purposes and shall otherwise be appropriately
completed. Each Notice of Borrowing shall be irrevocable upon receipt by the
Program Agent. If the Borrower fails to deliver a Notice of Borrowing in
accordance with this Section 2.02 its Preliminary Borrowing Notice shall be
deemed to be revoked by the Borrower without incurring any costs, penalties,
expenses or other liability (including, without limitation, under this Section
2.02 or Section 2.08 or as a Liquidation Fee). The Requested Amount specified in
any Notice of Borrowing shall be at least $1,000,000 and in integral multiples
of $100,000 in excess thereof. The Borrower shall not request more than two (2)
borrowings in any calendar week. During the period prior to the Termination
Date, each Conduit Lender shall promptly notify the Program Agent whether it has
determined to make an Advance and if it has decided to make an Advance, such
notice shall specify the principal amount thereof. If the Conduit Lenders have
declined to make a proposed Advance in the full Requested Amount, the Program
Agent shall promptly send notice of the proposed borrowing to each of the
Secondary Lenders concurrently by telecopier, telex or cable specifying the
Borrowing Date for such borrowing, each Secondary Lender's Secondary Lender
Percentage of the Requested Amount and whether the Yield for such Advance is
calculated based on the Eurodollar Rate or the Alternate Base Rate. Provided
that the Borrower has delivered a Preliminary Borrowing Notice and a Notice of
Borrowing in
25
accordance with this Section 2.02, on each Borrowing Date the Conduit Lenders or
the Secondary Lenders shall, subject to the terms and conditions of this
Agreement, make available to the Borrower at the Borrower's Account (or such
other account specified in the applicable Notice of Borrowing) Advances in an
amount equal to the Requested Amount in immediately available funds. To the
extent not covered by Section 2.08, the Borrower shall indemnify each Conduit
Lender, each Secondary Lender and the Program Agent against any loss or expense
incurred by them as a result of any failure by the Borrower to accept any
Advance requested in a Notice of Borrowing or as a result of the failure of the
Borrower to receive any Advance requested in a Notice of Borrowing as a result
of the failure of any condition precedent to the making of such Advance to be
satisfied, including, without limitation, any loss or expense incurred by reason
of the liquidation or reemployment of funds acquired or requested to fund such
Advance.
SECTION 2.03. Noteless Agreement; Evidence of Indebtedness.
(a) Each Lender and each Secondary Lender shall maintain in accordance with
its usual practice an account or accounts evidencing the indebtedness of the
Borrower to such Lender or such Secondary Lender, as applicable, in respect of
each Advance funded by it, from time to time, including the amounts of principal
and Yield thereon and paid to such Lender or Secondary Lender, as applicable,
from time to time hereunder.
(b) The Program Agent shall maintain accounts in which it will record (i)
the amount of each Advance funded by the Lenders and the Secondary Lenders and
the Settlement Period with respect thereto, (ii) the amount of any principal and
Yield due and payable or to become due and payable from the Borrower to each
Lender and Secondary Lender hereunder, and (iii) the amount of any sum received
by the Program Agent hereunder from the Borrower and each Lender's and Secondary
Lender's share thereof. If consent of the Majority Banks is required by the
terms of this Agreement for any action or inaction then being taken or not taken
under this Agreement, then upon the written request of the Borrower, the Program
Agent shall use reasonable efforts to as promptly as possible notify the
Borrower (i) of the Commitment (as defined in the Asset Purchase Agreement) of
each Secondary Lender in its capacity as a purchaser under the Asset Purchase
Agreement, (ii) if any Secondary Lender constitutes a Defaulting Bank, and (iii)
of the outstanding principal amount of the Advances of each Lender and each
Secondary Lender; provided, that the Program Agent shall have no liability for
any error in any notice provided by it pursuant to this Section 2.03(b) or for
any delay in providing such notice.
(c) The entries maintained in the accounts maintained pursuant to clauses
(a) and (b) of this Section 2.03 shall be rebuttable presumptive evidence of the
existence and amounts of the Borrower Obligations therein recorded (absent
manifest error); provided, however, that the failure of the Program Agent, any
Lender or any Secondary Lender to maintain such accounts or any error therein
shall not in any manner affect the obligation of the Borrower to repay the
Borrower Obligations in accordance with their terms.
26
(d) Any Conduit Lender and any Secondary Lender may request that its
Advances be evidenced by an Advance Note. In such event, the Borrower shall (as
soon as reasonably practicable) prepare, execute and deliver to such Conduit
Lender or Secondary Lender, as applicable, an Advance Note payable to the order
of such Conduit Lender or Secondary Lender, as applicable. Thereafter, the
Advances evidenced by such Advance Note and interest thereon shall at all times
(including after any assignment pursuant to Section 9.06) be represented by one
or more Advance Notes payable to the order of the payee named therein or any
assignee pursuant to Section 9.06, except to the extent that any such Conduit
Lender, Secondary Lender or assignee subsequently returns to the Borrower any
such Advance Note for cancellation and requests that such Advances once again be
evidenced as described in clauses (a) and (b) of this Section 2.03. In
connection with any assignment pursuant to Section 9.06, if such assigning
Secondary Lender shall have an Advance Note issued to it, such assigning
Secondary Lender shall promptly return its Advance Note to the Borrower marked
"cancelled".
SECTION 2.04. Maturity of the Advances.
The principal amount of, and the accrued and unpaid Yield on each
outstanding Advance shall be due and payable by the Borrower on the Maturity
Date for such Advance.
SECTION 2.05. Prepayment of the Advances.
(a) The Borrower shall have the right at any time and from time to time,
upon not less than two (2) Business Days' prior written or telephonic notice (in
the case of telephonic notice, promptly confirmed in writing) to the Program
Agent specifying the date and amount of such prepayment, to prepay (without any
premium or penalty, except for any Liquidation Fee or amount payable under
Section 2.08) all or a portion of the outstanding Advances, together with unpaid
Yield thereon, on a Business Day; provided, that any such prepayment, if a
partial prepayment, shall be at least $1,000,000.
(b) If on any Determination Date the Borrower is not in full compliance
with the Borrowing Base Test, the Borrower shall on such Determination Date (I)
notify the Program Agent of such failure to comply, and (II) on the Business Day
next succeeding such Determination Date (each such date, a "Compliance
Certification Date") prepay Advances (together with Yield thereon) in an amount
necessary to cause the Borrower to be in full compliance with the Borrowing Base
Test on such Compliance Certification Date; provided, however, that to the
extent the Borrower does not have sufficient available funds to fully cure such
compliance shortfall on such Compliance Certification Date, then the Borrower
shall (i) on such Compliance Certification Date prepay outstanding Advances in
the amount of its available funds; (ii) no later than the close of business on
the tenth (10th) Business Day following such Determination Date either (A)
acquire and pledge to the Program Agent under this Agreement and the Control
Agreement additional Borrowing Base Eligible Assets having an Adjusted Asset
Value at least sufficient to cause the Borrowing Base to be at least equal to
the product of (x) 1.05, and (y) Credits Outstanding, as determined on such
Compliance Certification Date, or
27
(B) prepay Advances in a principal amount (and pay the Yield thereon) at least
sufficient to cause the Borrowing Base to be at least equal to the product of
(x) 1.05 and (y) Credits Outstanding, as determined on such Compliance
Certification Date; and (iii) no later than the close of business on such
Compliance Certification Date, deliver to the Program Agent a certificate,
signed by an Responsible Officer of the Borrower, that (1) certifies the amount
of the compliance shortfall, (2) specifies whether the Borrower shall either (x)
prepay the Advances in accordance with clause (B) above, or (y) acquire
additional Borrowing Base Eligible Assets in accordance with clause (A) above
and specifies the identity and Adjusted Asset Value of the Borrowing Base
Eligible Assets for which the Borrower has entered into corrective trades in
order to satisfy the requirements of clause (A) of this Section 2.05(b), and (3)
certifies that the requirements of this Section 2.05(b) shall be satisfied on or
prior to the tenth (10th) Business Day following such Determination Date.
(c) The amount of each prepayment under this Section 2.05 shall be applied
ratably to the Advances of each Lender and each Secondary Lender in the order in
which such Advances were made by such Lender or Secondary Lender.
SECTION 2.06. Yield.
The Borrower hereby agrees to pay the Yield computed with reference to the
principal amount of each Advance outstanding from time to time. Yield accruing
in respect of any Advance for any Settlement Period shall be due and payable on
the Settlement Date immediately succeeding such Settlement Period and as
required by Section 2.05; provided, that, accrued Yield computed by reference to
the Eurodollar Rate shall be paid on the last day of such Settlement Period, or
if such day is not a Business Day, the immediately succeeding Business Day. It
is the intention of the parties hereto that the Yield on the Advances shall not
exceed the maximum rate permissible under applicable law. Accordingly, anything
herein or in any Advance Note to the contrary notwithstanding, in the event any
Yield is charged to, collected from or received from or on behalf of the
Borrower by the Lenders or the Secondary Lenders pursuant hereto or thereto in
excess of such maximum lawful rate, then the excess of such payment over that
maximum shall be applied first to the payment of amounts then due and owing by
the Borrower to the Secured Parties under the Program Documents (other than in
respect of principal and Yield on Advances), then to the reduction of the
outstanding principal balance of the Advances then due and then any excess
amount to be returned to the Borrower.
SECTION 2.07. Increased Costs.
(a) If, due to either (i) the introduction of or any change (other than any
change by way of imposition or increase of reserve requirements reflected in the
Eurodollar Rate Reserve Percentage) in or in the interpretation of any
Applicable Law or (ii) the compliance with any guideline or request from any
central bank or other Authority (whether or not having the force of law), there
shall be any increase in the cost to any Affected Person of agreeing to make or
making, funding or maintaining Eurodollar Rate Advances to the Borrower, then
the Borrower
28
from time to time shall, as promptly as practicable upon written demand by such
Affected Person pay to the Program Agent for the account of such Affected Person
additional amounts sufficient to compensate such Affected Person for such
increased cost; provided, however, that no additional amounts shall be required
under this Section 2.07 with respect to (i) income or profits taxes (or
franchise taxes imposed in lieu thereof), (ii) Taxes or Other Taxes in effect on
the date that such Affected Person became a party to this Agreement or otherwise
became committed to purchase or acquire any interest in any Advances (whether by
assignment, participation or otherwise), except to the extent that such Affected
Person's assignor or predecessor was entitled to such additional amounts, and
(iii) Taxes to the extent avoidable had such Person complied with the provisions
of Section 9.03(f). In determining such amount, such Affected Person may in good
faith use any reasonable averaging and attribution methods, consistent with the
averaging and attribution methods generally used by such Affected Person in
determining amounts of this type with respect to other borrowers. Each such
Affected Person shall, together with its written demand therefor, deliver to the
Borrower and the Program Agent a certificate setting forth in reasonable detail
the amount of such increased cost and the basis for the calculation of such
amount, which certificate shall be conclusive and binding for all purposes,
absent manifest error.
(b) If an Affected Person determines that compliance with any Applicable
Law enacted after the Closing Date or request from any central bank or other
Authority charged with the interpretation or administration thereof (whether or
not having the force of law) affects the amount of capital required or expected
to be maintained by such Affected Person and that the amount of such capital is
increased by or based upon the existence of such Affected Person's commitment
under the Program Documents or upon such Affected Person's making, funding or
maintaining Advances, then, as promptly as practicable upon written demand of
such Affected Person (with a copy of such demand to the Program Agent), the
Borrower shall pay to the Program Agent for the account of such Affected Person,
from time to time as specified by such Affected Person, additional amounts
sufficient to compensate such Affected Person in light of the circumstances.
Each such Affected Person shall, together with its written demand therefore,
deliver to the Borrower and the Program Agent a certificate setting forth in
reasonable detail such amounts and the basis for the calculation of such
amounts, which certificate shall be conclusive and binding for all purposes,
absent manifest error.
(c) Upon the occurrence of any event giving rise to the Borrower's
obligation to pay additional amounts to any Affected Person pursuant to Sections
2.07(a), 2.07(b) or 9.03, such Affected Person will, if requested by the
Borrower, use reasonable efforts (subject to overall policy considerations of
such Affected Person) to designate a different lending office; provided,
however, that such designation is made on such terms that such Affected Person
and its lending office suffer no significant economic, legal or regulatory
disadvantage, with the object of avoiding future consequence of the event giving
rise to the operation of any such Section. If such additional amounts are not
eliminated by any such designation and such Affected Person does not waive
payment of such additional amounts, the Program Agent, may at its sole
discretion within sixty (60) days, recommend a replacement Affected Person not
so affected. If after the sixty (60) day period described in the preceding
sentence a replacement for
29
such Affected Person has not been procured, the Borrower may propose a
replacement for such Affected Person and, upon approval of the Program Agent
(which approval shall not be unreasonably withheld or delayed), such Affected
Person shall assign its interests under the applicable Program Documents to such
replacement entity. The parties hereby agree that unless and until the Affected
Person to be replaced (i) is paid in full for all amounts due and owing to it
hereunder and under any other Program Document, and (ii) enters into assignment
documents with the replacement entity which are reasonably satisfactory to such
Affected Person, it shall have no obligation to assign any of its rights and
interests hereunder. Each such Affected Person agrees to take all actions
necessary to permit a replacement entity to succeed to its rights and
obligations hereunder and under the other Program Documents. The Borrower agrees
to pay all reasonable expenses incurred by any Affected Person in utilizing
another lending office of such Affected Person or in assigning its interest
pursuant to this Section 2.07(c). Nothing in this Section 2.07(c) shall affect
or postpone any of the obligations of the Borrower or the rights of any Secured
Party.
SECTION 2.08. Compensation.
Without duplication of any amount due by the Borrower in respect of any
Liquidation Fee, the Borrower shall compensate each Affected Person, upon its
written request (which request shall set forth in reasonable detail the basis
for requesting such amounts and the details showing the basis of the calculation
of such amounts), for all reasonable losses, expenses and liabilities
(including, without limitation, any interest paid by such Affected Person to
lenders of funds borrowed by it to make or carry its Eurodollar Rate Advances
and any loss sustained by such Affected Person in connection with the
re-employment of such funds), which such Affected Person may sustain: (i) if for
any reason (other than a default by such Affected Person) a borrowing of any
Eurodollar Rate Advance by the Borrower does not occur on a date specified
therefor in the Notice of Borrowing, (ii) if any prepayment of any of the
Borrower's Eurodollar Rate Advances occurs on a date which is not the last day
of a Settlement Period applicable thereto, (iii) if any prepayment of any of the
Borrower's Eurodollar Rate Advances is not made on any date specified in a
notice of prepayment given by the Borrower, or (iv) as a consequence of any
other default by the Borrower to repay its Eurodollar Rate Advances when
required by the terms of this Agreement.
SECTION 2.09. Additional Yield on Eurodollar Rate Advances.
So long as any Affected Person shall be required under regulations of the
Board of Governors of the Federal Reserve System to maintain reserves with
respect to liabilities or assets consisting of or including Eurocurrency
Liabilities, the Borrower shall pay as promptly as practicable following written
demand therefor to such Affected Person Eurodollar Additional Yield on the
principal amount of each outstanding Eurodollar Rate Advance on each date on
which Yield is payable on such Advance. Such Eurodollar Additional Yield shall
be determined on a reasonable basis by such Affected Person and notified to the
Borrower through the Program Agent within thirty (30) days after any payment is
made with respect to which such additional
30
Yield is requested. Each such Affected Person shall, together with the written
demand therefor, deliver to the Borrower and the Program Agent a certificate
setting forth in reasonable detail the amount of such Eurodollar Additional
Yield and the basis for the calculation of such amount, which certificate shall
be conclusive and binding for all purposes, absent manifest error.
SECTION 2.10. Termination or Reduction of the Total Commitment.
The Borrower may at any time, upon thirty (30) days prior written notice to
the Program Agent terminate in whole or reduce in part the unused portion of the
Total Commitment; provided, that each such partial reduction of the Total
Commitment shall be in an amount equal to at least $5,000,000 or an integral
multiple thereof. Any reduction of the Total Commitment shall reduce ratably (or
terminate) the Secondary Lender Commitment of each Secondary Lender.
SECTION 2.11. Rescission or Return of Payment.
The Borrower further agrees that, if at any time all or any part of any
payment theretofore made by it to any Secured Party or their designees is or
must be rescinded or returned for any reason whatsoever (including, without
limitation, the insolvency, bankruptcy or reorganization of the Borrower or any
of its Affiliates), the obligation of the Borrower to make such payment to such
Secured Party shall, for the purposes of this Agreement, to the extent that such
payment is or must be rescinded or returned, be deemed to have continued in
existence and this Agreement shall continue to be effective or be reinstated, as
the case may be, as to such obligations, all as though such payment had not been
made.
SECTION 2.12. Fees Payable by Borrower.
The Borrower agrees to pay to the Program Agent for the benefit of the
applicable Secured Parties such fees as are set forth in the Fee Letter.
SECTION 2.13. Post Default Interest.
The Borrower hereby promises to pay interest on the unpaid principal amount
of each Advance and any other amount payable by the Borrower hereunder, in each
case, which shall not be paid in full when due, for the period commencing on the
due date thereof until but not including the date the same is paid in full at
the Post-Default Rate. Interest payable at the Post-Default Rate shall be
payable on the Program Agent's demand.
SECTION 2.14. Payments.
(a) All amounts owing and payable by the Borrower to any Secured Party, any
Affected Person or any Indemnified Party under this Agreement, including,
without limitation, the principal amount of outstanding Advances, Yield, fees,
indemnities, expenses or
31
other amounts payable by the Borrower to any Secured Party, any Affected Person
or any Indemnified Party under the Program Documents, shall be paid in Dollars,
in immediately available funds on or prior to 12:00 noon (Chicago time) on the
date due without counterclaim, setoff, deduction, defense, abatement, suspension
or deferment. Subject to Section 2.14(d) and Section 7.03 all payments in
respect of the Borrower Obligations, payable by or on behalf of the Borrower to
the Lenders, Secondary Lenders, any Affected Person, any Indemnified Party and
the Program Agent shall be paid to the Program Agent's Account. Any payment paid
after 12:00 noon (Chicago time) on any day shall be deemed to have been made on
the next Business Day for all purposes of this Agreement.
(b) All computations of interest at the Post-Default Rate and all
computations of Yield, fees and other amounts hereunder and under the Fee Letter
shall be made on the basis of a year of 360 days for the actual number of days
elapsed. Whenever any payment or deposit to be made hereunder and under the Fee
Letter shall be due on a day other than a Business Day, such payment or deposit
shall be made on the next succeeding Business Day and such extension of time
shall be included in the computation of such payment or deposit.
(c) Subject to Sections 2.14(d) and 7.03(a), upon the Program Agent's
receipt of funds deposited into the Program Agent's Account, the Program Agent
shall distribute such funds, first to the Lenders and the Secondary Lenders on a
pro rata basis in accordance with such amounts owed to each Lender and Secondary
Lender in payment of all accrued and unpaid Yield owing to such Lenders and
Secondary Lenders, second to such Lenders, such Secondary Lenders and itself as
Program Agent on a pro rata basis in accordance with such amounts owed to each
such Person in payment of any other fees or other amounts owed by the Borrower
to the Lenders, the Secondary Lenders and the Program Agent under this Agreement
and the other Program Documents (other than in respect of the principal amount
of the Advances), and third to the payment of the principal amount of the
Advances owing to such Lenders and Secondary Lenders on a pro rata basis in
accordance with such amounts owed to each such Lender and Secondary Lender.
(d) During the continuance of an Event of Default all payments in respect
of the Borrower Obligations, payable by or on behalf of the Borrower, including
all Proceeds resulting from the sale or disposition of the Pledged Collateral
shall be remitted to the Program Agent's Account and applied in accordance with
Section 7.03(a).
SECTION 2.15. Ratable Payments.
If any Secondary Lender or Lender (other than a Conduit Lender), whether by
set-off, bankers' lien, counterclaim or otherwise, has payment made to it with
respect to any Borrower Obligations owing to it in a greater proportion than
that received by any other Lender or Secondary Lender entitled to receive a
ratable share of such payments, such Lender or Secondary Lender agrees, promptly
upon demand, to purchase for cash without recourse or warranty a portion of the
unpaid Borrower Obligations held by the other Lenders and Secondary Lenders so
that after such purchase each Lender and Secondary Lender will hold its ratable
32
proportion of such unpaid Borrower Obligations; provided that if all or any
portion of such excess amount is thereafter recovered from such Secondary Lender
or Lender, as the case may be, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.
SECTION 2.16. Borrower's Obligations Absolute.
The Borrower's obligations to each Secured Party, each Affected Person and
each Indemnified Party under this Agreement and under the other Program
Documents (other than the Loan Documents) to which it is a party shall be
absolute, unconditional and irrevocable, and shall be paid strictly in
accordance with the terms hereof and thereof, under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment which the
Borrower, the Adviser or any other Person may have or have had against any
Secured Party or any other Person.
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.01. Conditions Precedent to the Effectiveness of the Existing
Credit Agreement.
The Borrower hereby confirms that concurrently with the effectiveness of
the Existing Credit Agreement on the Closing Date, the Program Agent received on
or before the initial borrowing date after the Closing Date under the Existing
Credit Agreement the following:
(a) each of the Program Documents (as defined in the Existing Credit
Agreement in effect on the Closing Date) (other than the Loan Documents (as
defined in the Existing Credit Agreement in effect on the Closing Date)) duly
executed and delivered by the parties thereto, each of which was in full force
and effect on the Closing Date;
(b) the Prospectus (as defined in the Existing Credit Agreement), as in
effect on the Closing Date;
(c) the signed opinions of counsel to the Borrower and the Adviser
addressed to the Program Agent, the Conduit Lenders and each Secondary Lender as
to such matters as the Program Agent shall have reasonably requested;
(d) if requested by any Conduit Lender or any Secondary Lender pursuant to
Section 2.03 of the Existing Credit Agreement on or prior to the Closing Date,
an Advance Note duly executed and completed by the Borrower to such Conduit
Lender or such Secondary Lender, as applicable;
33
(e) copies of all Governmental Authorizations, material Private
Authorizations and Governmental Filings, if any, required to be made or obtained
by the Borrower in connection with the transactions contemplated by the Existing
Credit Agreement;
(f) a certificate of the Secretary or Assistant Secretary of each of the
Borrower and the Adviser certifying (i) as to its certificate of incorporation
or declaration of trust, as applicable and by-laws, (ii) as to the resolutions
of its Board of Directors or Board of Trustees, as applicable, approving the
Existing Credit Agreement and the other Program Documents (other than the Loan
Documents) to which it was a party as of the Closing Date and the transactions
contemplated thereby, (iii) that its representations and warranties set forth in
the Program Documents (as defined in the Existing Credit Agreement) (other than
the Loan Documents) to which it was a party as of such date were true and
correct in all material respects, and (iv) the incumbency and specimen signature
of each of its officers authorized to execute the Program Documents (as defined
in the Existing Credit Agreement) (other than the Loan Documents) to which it
was a party as of such date;
(g) copies of proper financing statements naming the Borrower as debtor and
the Program Agent as secured party filed under the UCC in all jurisdictions that
the Program Agent deemed necessary or desirable in order to perfect the Program
Agent's interests in the Pledged Collateral contemplated by the Existing Credit
Agreement;
(h) copies of proper termination financing statements, if any, necessary to
release all Adverse Claims of any Person in the Assets of the Borrower
previously granted by the Borrower;
(i) completed requests for information, dated on or before the date of the
initial Borrowing Date (as defined in the Existing Credit Agreement), listing
all effective financing statements filed in the jurisdictions referred to in
subsection (g) above that name the Borrower (under its present name and any
previous name) as debtor, together with copies of such other financing
statements; and
(j) a pro forma Investor Report, which shall evidence compliance with the
Borrowing Base Test, the Asset Coverage Test and certain other terms of the
Program Documents (as such terms are defined in the Existing Credit Agreement)
(other than the Loan Documents) after giving effect to the initial borrowing of
Advances (as defined in the Existing Credit Agreement) under the Existing Credit
Agreement.
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SECTION 3.02. Conditions Precedent to All Advances.
The obligation of the Conduit Lenders and the Secondary Lenders to make any
Advance (including the initial Advances) on any Borrowing Date shall be subject
to the fulfillment of the following conditions:
(a) each of the representations and warranties of the Borrower contained in
this Agreement and the Control Agreement and each of the representations and
warranties of the Adviser contained in the Letter Agreement shall be true and
correct as of such date and shall continue to be true immediately after giving
effect to such Advance;
(b) no Default or Event of Default shall have occurred and be continuing or
shall result from the making of such Advance;
(c) immediately after giving effect to such Advance the Borrower shall be
in full compliance with each of the Borrowing Base Test and the Asset Coverage
Test;
(d) immediately after the making of any such Advance, the aggregate
outstanding principal amount of all Advances shall not exceed the Total
Commitment; and
(e) the Program Agent shall have received an Investor Report.
SECTION 3.03. Conditions Precedent to the Effectiveness of this Agreement.
The effectiveness of the amendment and restatement of the Existing Credit
Agreement as set forth in this Agreement shall be subject to the conditions
precedent that each Program Document be in full force and effect and that the
Agent shall have received the following, each (unless otherwise indicated) in
form and substance reasonably satisfactory to the Program Agent and the
Secondary Lenders parties hereto in sufficient copies for the Conduit Lenders
and the Secondary Lenders:
(a) duly executed copies of this Agreement, the Asset Purchase Agreement,
the Agreement of Amendment and the Fee Letter from each of the Borrower, the
Custodian, the Adviser, the Lenders, the Secondary Lenders and the Agent, as the
case may be;
(b) the Prospectus, as in effect on the Restatement Effective Date;
(c) a certificate of the Secretary or Assistant Secretary of the Borrower
certifying that the Prospectus, as delivered pursuant to clause (b) above has
not been modified since the Closing Date, other than any modifications in
accordance with the provisions of the Existing Credit Agreement (except that for
the purposes of this certificate, Section 5.02(i) of the Existing Credit
Agreement shall be deemed to be amended as set forth in this Agreement) and that
the replacement of the Prospectus (as defined in the Existing Credit Agreement)
with the Prospectus was effected in accordance with the provisions of the
Existing Credit Agreement (except that for
35
the purposes of this certificate, Section 5.02(i) of the Existing Credit
Agreement shall be deemed to be amended as set forth in this Agreement);
(d) the signed opinions of counsel to the Borrower and the Adviser
addressed to the Program Agent, the Conduit Lenders and each Secondary Lender as
to such matters as the Program Agent shall have reasonably requested;
(e) all Governmental Authorizations, material Private Authorizations and
Governmental Filings, if any, which may be required in connection with the
transactions contemplated by this Agreement;
(f) the results of a recent search by a Person reasonably satisfactory to
the program Agent of all UCC lien filings with respect to the Borrower, and such
results shall be satisfactory to the Program Agent;
(g) copies of proper financing statements and/or financing statement
amendments naming the Borrower as debtor and the Program Agent as secured party
filed under the UCC in all jurisdictions that the Program Agent deemed necessary
or desirable in order to perfect and maintain the perfection of the Program
Agent's interests in the Pledged Collateral contemplated by this Agreement; and
(h) if requested by any Conduit Lender or Secondary Lender under Section
2.03 on or prior to the Restatement Effective Date, an Advance Note duly
executed and completed by the Borrower to such Conduit Lender or Secondary
Lender, as applicable, provided that such Conduit Lender or Secondary Lender
shall have returned any advance note issued by the Borrower to such Conduit
Lender or Secondary Lender pursuant to the Existing Credit Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower.
The Borrower represents and warrants to each of the Secured Parties on and
as of the Restatement Effective Date, each Borrowing Date and each Weekly
Determination Date (except solely in respect of clause (l) below, each date such
information is provided), as follows:
(a) Due Organization. The Borrower is a business trust duly organized,
validly existing and in good standing under the laws of the Commonwealth of
Massachusetts, with full power and authority to own and operate its Assets,
conduct the business in which it is now engaged and to execute and deliver and
perform its obligations under this Agreement and the other Program Documents to
which it is a party, except where the failure to hold such power and authority
could not reasonably be expected to result in a Material Adverse Effect.
36
(b) Due Qualification and Good Standing. The Borrower is duly qualified to
do business and is in good standing in each jurisdiction in which the nature of
its business, assets and properties, including, without limitation, the
performance of its obligations under this Agreement and the other Program
Documents to which it is a party, requires such qualification, except where the
failure to be so qualified or to be in good standing could not reasonably be
expected to have a Material Adverse Effect.
(c) Due Authorization; Execution and Delivery; Legal, Valid and Binding;
Enforceability. The execution and delivery by the Borrower of, and the
performance by the Borrower of its obligations under the Program Documents to
which it is a party are within its powers and have been duly authorized by all
requisite action by the Borrower and have been duly executed and delivered by
the Borrower and constitute the legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with their respective
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
(d) Noncontravention. Neither the execution and delivery by the Borrower of
this Agreement, the other Program Documents to which it is a party nor the
consummation of the transactions herein or therein contemplated, nor compliance
with the terms, conditions and provisions hereof or thereof by it, will (i)
conflict with, or result in a breach or violation of, or constitute a default
under its declaration of trust or other organizational documents, (ii) conflict
with or contravene (A) any Applicable Law the contravention of which could
reasonably be expected to have a Material Adverse Effect, (B) any contractual
restriction binding on or affecting the Borrower or any of its Assets the
contravention of which could reasonably be expected to have a Material Adverse
Effect or which could reasonably be expected to result in any material liability
to a Secured Party, or (C) any order, writ, judgment, award, injunction or
decree binding on or affecting the Borrower or any of its Assets, except to the
extent non-compliance therewith could not reasonably be expected to have a
Material Adverse Effect, or (iii) result in any Adverse Claim upon any Asset of
the Borrower.
(e) Governmental Authorizations; Private Authorizations; Governmental
Filings. The Borrower has obtained all necessary Governmental Authorizations and
Private Authorizations, and made all Governmental Filings necessary for the
execution and delivery by the Borrower of, and the performance by the Borrower
of its obligations under this Agreement, the other Program Documents to which it
is a party and the agreements, certificates and instruments contemplated hereby
or thereby, except in the case of Private Authorizations, where the failure to
obtain such Private Authorizations could not reasonably be expected to have a
Material Adverse Effect.
(f) Security Interest. This Agreement and the Control Agreement and the
actions required to be taken pursuant to the terms hereof are, and at all times
shall be, effective to create and perfect in the Program Agent for the benefit
of the Secured Parties a first priority
37
perfected security interest in the Pledged Collateral (subject to the Lien of
the Custodian securing the Custodian's Overdraft Advances to the extent
permitted by Section 5.02(o) and other Permitted Liens) free and clear of all
Adverse Claims.
(g) Borrowing Base Eligible Assets, Adverse Claims, Etc. The Borrower owns
each Borrowing Base Eligible Asset free and clear of Adverse Claims and as of
the initial Borrowing Date and at all times thereafter, the Program Agent has a
first priority perfected security interest in the Pledged Collateral (subject to
the Lien of the Custodian securing the Custodian's Overdraft Advances to the
extent permitted by Section 5.02(o) and other Permitted Liens) free and clear of
all Adverse Claims.
(h) No Financing Statement. No effective financing statements or other
instruments similar in effect covering any Asset of the Borrower are on file in
any recording office, except those filed in favor of the Program Agent pursuant
to this Agreement.
(i) Principal Office; Organization. The Borrower's principal place of
business and chief executive office is at the addresses referred to in Section
5.01(d), the Borrower's jurisdiction of organization is the Commonwealth of
Massachusetts and during the prior five (5) year period the Borrower has not
transacted any business under any name other than "▇▇▇ ▇▇▇▇▇▇ Senior Loan Fund",
"▇▇▇ ▇▇▇▇▇▇ Prime Rate Income Trust" and "▇▇▇ ▇▇▇▇▇▇ Senior Floating Rate Fund".
(j) Pending Litigation or Other Proceeding. There are no pending or, to the
best of the Borrower's knowledge, threatened investigations, litigation, suits
or proceedings involving the Borrower which could reasonably be expected to have
a Material Adverse Effect.
(k) Investment Company Act, Etc. The Borrower is and will continue to be
registered as a closed-end management investment company as such term is used in
the Investment Company Act and is in compliance in all material respect with the
Investment Company Act and the Investment Policies and Restrictions.
(l) Information and Reports. The Prospectus, each Investor Report, each
Notice of Borrowing and all other written information, written reports,
certificates and written statements provided by or on behalf of the Borrower to
any Secured Party for purposes of or in connection with this Agreement, the
other Program Documents to which the Borrower is a party or the transactions
contemplated hereby or thereby to be performed by the Borrower is, and all such
information hereafter provided by or on behalf of the Borrower to any Secured
Party is and will be (except for projections and forward looking statements
(other than any pro forma Investor Report)) true and accurate in all material
respects on the date such information is stated or certified and no such
information contains, or will contain, any material misrepresentation or any
omission to state therein matters necessary to make the statements made therein
not misleading in any material respect under the circumstances in which they
were made when considered in their entirety.
38
(m) Applicable Law. The Borrower is in full compliance with all Applicable
Law, including, without limitation, the Securities Act and the Investment
Company Act, including the rules and regulations promulgated thereunder, except
where the failure to so comply could not give rise to a reasonable possibility
of a Material Adverse Effect.
(n) ERISA. The Borrower is not nor has during the past five (5) years been
a member of an ERISA Group and does not have nor during the past five (5) years
had any liability or obligation with respect to any Plan, Multiemployer Plan or
Benefit Arrangement; provided, however, that the Borrower may incur liabilities
or obligations under a plan or arrangement substantially in the form of the Form
of Retirement Plan For Each Closed End Fund or the Form of Amended and Restated
Deferred Compensation Agreement, each attached hereto as Schedule II.
(o) No Default or Event of Default. No Default or Event of Default has
occurred and is continuing and on each Borrowing Date each of the conditions
precedent to the making of Advances set forth in Section 3.02 have been fully
satisfied.
(p) Borrowing Base Test; Asset Coverage Test, Etc. The Borrowing Base Test
and the Asset Coverage Test are fully satisfied and will be fully satisfied and
immediately after the making of each Advance; provided, that if on any date this
representation is made (other than a Borrowing Date) the Borrower is in full
compliance with the requirements set forth in Section 2.05(b), the Borrower
shall be deemed to be in compliance with this clause (p) to the extent it
relates to the Borrowing Base Test as of such date.
(q) Internal Revenue Code. The Borrower is qualified, and intends to
continue to qualify, as a "regulated investment company" within the meaning of
the Code.
(r) Taxes. The Borrower has filed all United States Federal income tax
returns and all other material tax returns which are required to be filed by it,
if any, and has paid all material taxes due pursuant to such returns, if any, or
pursuant to any assessment received by the Borrower, except for any taxes or
assessments which are being contested in good faith by appropriate proceedings
and with respect thereto adequate reserves have been established in accordance
with GAAP.
(s) Financial Condition. The statement of assets and liabilities of the
Borrower as at July 31, 2005, certified by Deloitte & Touche LLP, certified
public accountants, fairly present in conformity with GAAP the financial
position of the Borrower at such date and since such date there has been no
material adverse change in the business, financial condition or results of
operations of the Borrower.
(t) Regulations T, U and X. Neither the making of any Advance nor the use
of proceeds thereof will violate the provisions of Regulation U or Regulation X.
The Borrower's use of the proceeds of the Advances will not violate Regulation
T.
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ARTICLE V
COVENANTS
SECTION 5.01. Affirmative Covenants of the Borrower.
The Borrower covenants and agrees that it shall from the date hereof until
the Program Termination Date:
(a) Compliance with Agreements, Laws, Etc. (i) Duly observe, comply with
and conform to all requirements of Applicable Law relative to the conduct of its
business or to its Assets, including without limitation the Investment Company
Act, (ii) preserve and keep in full force and effect the legal existence of the
Borrower and the rights, privileges, qualifications and franchises of the
Borrower, (iii) comply in all material respects with the terms and conditions of
each Program Document to which it is a party, and (iv) obtain, maintain and keep
in full force and effect all Governmental Authorizations, Private Authorizations
and Governmental Filings which are necessary or appropriate to properly carry
out its business and the transactions contemplated to be performed by the
Borrower under this Agreement and the other Program Documents to which it is a
party, except with respect to clauses (i) through (iv) above where the failure
to so observe, comply, preserve, keep, obtain, maintain and conform could not
reasonably be expected to have a Material Adverse Effect.
(b) Taxes. Cause to be computed, paid and discharged when due all material
taxes, assessments and other governmental charges or levies imposed upon it, or
upon any income or Assets of the Borrower, prior to the day on which penalties
are attached thereto, unless and to the extent that the same shall be contested
in good faith by appropriate proceedings and with respect to which adequate
reserves have been established on the books of the Borrower in accordance with
GAAP.
(c) Further Assurances. Promptly, at its expense, execute and deliver such
further instruments and take such further action as is necessary in order to (i)
establish and protect the rights, interests and remedies created, or intended to
be created, in favor of the Secured Parties including, without limitation, all
such actions which are necessary or reasonably advisable to maintain and protect
the Secured Parties' first priority perfected (subject to the Lien of the
Custodian securing the Custodian's Overdraft Advances to the extent permitted by
Section 5.02(o) and other Permitted Liens) security interest in the Pledged
Collateral free and clear of Adverse Claims, and (ii) enable the Secured Parties
to enforce their rights and remedies under the Program Documents to which the
Borrower is a party, including, without limitation, to do all things necessary
at the reasonable request of the Program Agent during the continuance of an
Event of Default to have each Loan Asset which constitutes Pledged Collateral
and the related Loan Documents assigned to the Program Agent or its designee.
Further, without limiting the obligations of the Borrower set forth above, the
Borrower hereby authorizes the filing of any financing statements or
continuation statements, and amendments to financing statements, in any
jurisdictions and with any filing offices as the Program Agent may determine, in
its reasonable discretion, are necessary to perfect the security interest
granted to the Program Agent in
40
connection herewith. Such financing statements may describe the collateral in
the same manner as described herein or in the Control Agreement or may contain
an indication or description of collateral that describes such property in any
other manner as the Program Agent may determine, in its reasonable discretion,
is necessary to ensure the perfection of the security interest in the collateral
granted to the Program Agent in connection herewith, including, without
limitation, describing such property as "all assets of the debtor whether now
owned or hereafter acquired" or "all personal property of the debtor whether now
owned or hereafter acquired".
(d) Continued Existence. Keep the Commonwealth of Massachusetts as its
jurisdiction of organization and keep its chief executive office at ▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ or, upon thirty (30) days' prior written
notice to the Program Agent, in any other jurisdiction of organization or at any
other locations in jurisdictions where all actions to protect and perfect the
Program Agent's first priority perfected (subject to the Lien of the Custodian
securing the Custodian's Overdraft Advances to the extent permitted by Section
5.02(o) and other Permitted Liens) security interest in the Pledged Collateral
have been taken and completed.
(e) Financial Statement; Accountants' Reports; Other Information. Provide
to the Program
Agent (with enough additional copies for each Conduit Lender and each Secondary
Lender):
(i) as soon as available, and in any event within ninety (90) days
after the end of each fiscal year of the Borrower, a statement of assets
and liabilities of the Borrower as at the end of such fiscal year, and
statements of operations and of changes in net assets of the Borrower for
such fiscal year, and the Borrower's portfolio of investments as of the end
of such fiscal year, with an audit report thereon issued by Deloitte &
Touche LLP or other independent certified public accountants of nationally
recognized standing, together with the comparable report for the prior
fiscal year;
(ii) as soon as available and in any event within seventy-five (75)
days after the end of each first semi-annual fiscal period of the Borrower,
a statement of assets and liabilities of the Borrower as at the end of such
period, a statement of operations and of changes in net assets of the
Borrower for such period, and the portfolio of investments as of the end of
such period, all in reasonable detail and stating in comparative form the
respective figures for the comparable period in the preceding year,
prepared in accordance with GAAP, consistently applied and all certified
(subject to normal year-end adjustment) as to fairness of presentation in
all material respects by a Responsible Officer of the Borrower;
(iii) as soon as available, and in any event within sixty (60) days
after the end of the first and third fiscal quarters of the Borrower's
fiscal years, a list setting forth each of the senior loan assets held by
the Borrower and the Value thereof, in each case, as of the last day of
such quarter;
41
(iv) simultaneously with the delivery of each set of financial
statements referred to in clauses (i) and (ii) above, a statement of a
Responsible Officer to the effect that nothing has come to the attention of
such Responsible Officer to cause him/her to believe that any Default or
Event of Default existed on the date of such statements;
(v) as soon as possible, and in any event within three (3) Business
Days of the Borrower's actual knowledge of the occurrence of any Default or
Event of Default, a certificate of a Responsible Officer of the Borrower
setting forth the details thereof and the action which the Borrower is
taking or proposes to take with respect thereto;
(vi) as soon as possible, and in any event within two (2) Business
Days, after the Borrower has actual knowledge of any failure by the
Custodian to perform or observe any term, covenant or agreement on its part
to be performed under the Custodial Agreement which failure gives rise to a
reasonable possibility of a Material Adverse Effect, written notice thereof
executed by a Responsible Officer of the Borrower;
(vii) promptly upon the mailing thereof to the shareholders of the
Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(viii) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration statements
on Form S-8 or its equivalent) and unless duplicative of any deliveries to
be made under clauses (i) or (ii) above, annual and semi-annual reports
which the Borrower shall have filed with the SEC;
(ix) so long as any Advance or Borrower Obligation shall be
outstanding, within one (1) Business Day after the written request (which
request shall not be made more than weekly) of the Program Agent, a report
in substantially the form of the Investor Report in respect of the Assets
of the Borrower as of the determination date designated in such Program
Agent's request, together with a certificate of a Responsible Officer of
the Borrower in substantially the form of Annex A to the Investor Report;
(x) on or before the day which is two (2) Business Days prior to each
Settlement Date (or during the continuance of a Default or Event of Default
more frequently as the Program Agent shall reasonably request (which may be
daily)), an Investor Report substantially in the form of Schedule I hereto,
for the immediately preceding calendar month (or other relevant period if
delivered on a daily or weekly basis), together with a certificate of a
Responsible Officer of the Borrower in substantially the form of Annex A to
the Investor Report;
(xi) promptly upon its receipt of and contemporaneously with its
giving of any notice relating to the termination of the Custodial Agreement
or the Control Agreement, copies of any such notice;
42
(xii) prior to the issuance by the Borrower of any preferred shares,
notice of such issuance which notice shall include the offering materials
to be used in connection with the issuance of such preferred shares;
(xiii) prompt notice of any amendment or modification to the
Investment Policies and Restrictions which notice shall include, in
reasonable detail, a description of any such change; and
(xiv) from time to time such additional information regarding the
financial condition or business of the Borrower as the Program Agent may
reasonably request.
(f) Maintenance of Insurance. Maintain in force with financially sound and
reputable insurers, policies with respect to its assets and property and
business against such risks and in such amounts as are usually insured against
in the same general area in the case of entities engaged in similar lines of
business and as may be required by the Investment Company Act.
(g) Maintenance of Business. Remain at all times a closed-end investment
company for the purposes of the Investment Company Act and continue to engage in
business of the same general type as now conducted by the Borrower, and will
preserve, renew and keep in full force and effect its existence and rights,
privileges and franchises necessary or reasonably desirable in the normal
conduct of business and will at all times remain registered under the Investment
Company Act.
(h) Audits. Annually (or more frequently as the Program Agent, for itself
and as agent for the Secured Parties may require after the occurrence of and
during the continuance of a Default or an Event of Default) and at the sole cost
and expense of the Borrower (i) cause an independent nationally recognized
accounting firm reasonably satisfactory to the Program Agent, to enter the
premises of the Borrower and any Person to whom the Borrower delegates all or
any portion of its duties under any Program Document to which it is a party
(including, without limitation, the Adviser) and examine and audit the books,
records and accounts of the Borrower and such other Person relating to its
business, financial condition, operations and the Borrower's and such other
Person's performance under the Program Documents to which it is a party, (ii)
permit such accounting firm to discuss the Borrower's and such other Person's
affairs and finances with the officers, partners, employees and accountants of
any of them, (iii) cause such accounting firm to provide to the Program Agent a
certified report in respect of the foregoing, which shall be in form and scope
reasonably satisfactory to the Program Agent, and (iv) authorize such accounting
firm to discuss such affairs, finances and performance with representatives of
the Program Agent and their designees; provided, that, such examination and
audit of information provided to the Borrower in connection with any Loan
Document (which, for the avoidance of doubt, does not include the Loan Documents
relating to any Eligible Loan Asset) shall be subject to any prohibition set
forth in written confidentiality agreements entered into by the Borrower with
respect thereto.
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(i) Access to Records. Annually (or more frequently as the Program Agent,
for itself and as agent for the Secured Parties may require after the occurrence
of and during the continuance of a Default or an Event of Default) permit the
Program Agent and the Secondary Lenders or any Person designated by the Program
Agent and the Secondary Lenders to, upon reasonable advance notice and during
normal hours, visit and inspect at reasonable intervals its and any Person to
which it delegates any of its duties under the Program Documents to which it is
a party (including, without limitation, the Adviser) books, records and accounts
relating to its business, financial condition, operations, Assets and its
performance under the Program Documents to which it is a party and to discuss
the foregoing with its and such Person's officers, partners, employees and
accountants; provided, that the Program Agent and each Secondary Lender shall
use reasonable efforts to coordinate their inspections; provided, however, that
if under the terms of any agreement with any Person which is not an Affiliate of
the Adviser or the Borrower to whom the Adviser or the Borrower has delegated
any of its duties under any Program Document, only the Borrower or the Adviser,
as the case may be, is permitted to visit and inspect such Person's books,
records and accounts, it shall at the request of the Program Agent, exercise or
cause the applicable Adviser or the Borrower, as the case may be, to exercise
the rights specified in this Section 5.01(i) on behalf of such requesting
parties; provided, further, that the Program Agent's, each Secondary Lender's
and their respective designees' right to review information provided to the
Borrower in connection with any Loan Document (which, for the avoidance of
doubt, does not include the Loan Documents relating to any Eligible Loan Asset)
shall be subject to the prohibitions of any written confidentiality agreements
entered into by the Borrower with respect thereto, provided, that the Borrower
had used reasonable efforts to permit the Program Agent, the applicable
Secondary Lenders or their respective designees to review such information by
complying with any terms of such confidentiality agreement which would permit
disclosure of confidential information to the third parties.
(j) Investment Policies and Restrictions. At all times be in compliance in
all material respects with Investment Policies and Restrictions and maintain
necessary liquidity to meet its obligations to fund future advances or other
extensions of credit under the Loan Documents relating to its Loan Assets.
(k) Defense of Secured Parties' Interest. Warrant and defend each of the
Secured Parties' right and interest in, to and under the Pledged Collateral
against all Adverse Claims of all Persons whomsoever.
(l) Custody and Control. At all times cause all Borrowing Base Eligible
Assets of the Borrower (including all investments, if any, evidencing the same
and all Specified Loan Documents) to constitute Pledged Collateral and to be (i)
custodied with the Custodian or a sub-custodian of the Custodian pursuant to the
Custodial Agreement, and (ii) subject to the Custodian's control and custody in
accordance with the Control Agreement; provided, that if such Borrowing Base
Eligible Asset or Pledged Collateral is a Loan Asset, concurrently with any
request to register such Loan Asset in the name of the Borrower, the Borrower
shall deliver instructions to all Selling Institutions, Transaction Agents and
Obligors related to such Loan Asset requiring that any instrument evidencing
such Loan Asset be delivered to the Custodian.
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At all times cause all Loan Documents (other than the Specified Loan Documents)
to be held at the address of the Borrower set forth in Section 9.02 or, such
other location in Illinois as the Borrower shall designate upon twenty (20)
day's prior written notice to the Program Agent.
(m) Notice of Litigation or Other Proceedings. Promptly give notice in
writing to the Program Agent of all litigation, arbitration proceedings and
regulatory proceedings affecting the Borrower or the Assets of the Borrower,
except such litigation, arbitration proceedings and regulatory proceedings which
could not reasonably be expected to have a Material Adverse Effect.
(n) Maintenance of Books of Record and Account. Keep proper books of record
and account in which full, true and correct entries shall be made of all
dealings and transactions in relation to its business and activities in
accordance with the requirements of the SEC or under the Investment Company Act.
(o) Proceeds of Pledged Collateral. Cause all Proceeds of the Pledged
Collateral to be remitted to the Collateral Account if a Default or Event of
Default shall be continuing or would occur as a result of the failure to so
remit such Proceeds.
(p) Use of Proceeds. Use the net proceeds of any Advance made hereunder
solely for the purpose designated in the Notice of Borrowing with respect to
such Advance, which shall be either Short-term Purposes or Leverage Purposes.
(q) Investment Adviser. Except as consented to by the Program Agent and the
Secondary Lenders (which consent shall not be unreasonably withheld or delayed),
or as otherwise permitted by Section 6.01(n), at all times maintain the Adviser
as the Borrower's investment adviser.
SECTION 5.02. Negative Covenants of the Borrower.
The Borrower covenants and agrees that from the date hereof until the
Program Termination Date the Borrower shall not:
(a) Impairment of Rights. Enter into any agreement containing any provision
which would be violated or breached by the performance of its obligations under
any Program Document to which the Borrower is a party the continuation of which
could reasonably be expected to have a Material Adverse Effect or which could
reasonably be expected to result in any material liability to a Secured Party.
(b) Prospectus and Investment Policies and Restrictions. Purchase any
Assets or engage in any line of business not contemplated by the Prospectus or
the Investment Policies and Restrictions.
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(c) Creation of Debt. Create, assume or suffer to exist any Debt, except
for Permitted Debt.
(d) Mergers; Sale of Assets. Adopt or carry out any plan of liquidation,
partial liquidation, reorganization, incorporation, recapitalization, merger or
consolidation nor sell, transfer or otherwise dispose of all or substantially
all of its Assets (whether in one transaction or a series of transactions),
without the prior written consent of the Program Agent and the Secondary Lenders
(which consent shall not be unreasonably withheld or delayed).
(e) Advances and Extensions of Credit. Make any advance or other extension
of credit to any Person except in the ordinary course of the Borrower's business
and as expressly contemplated by the Investment Policies and Restrictions.
(f) Custodial Agreement. Without the prior written consent (which consent
shall not be unreasonably withheld or delayed) of the Program Agent, permit or
consent to any material amendment, modification or waiver of the Custodial
Agreement, unless the Borrower has delivered to the Program Agent a certificate
of a Responsible Officer of the Borrower certifying that such amendment,
modification or waiver could not reasonably be expected to have a Material
Adverse Effect.
(g) Amendments to Organizational Documents. Except in connection with the
issuance of preferred stock, amend, terminate, supplement or otherwise modify in
any material respect its declaration of trust, by-laws or other organizational
documents, unless the Borrower has delivered to the Program Agent a certificate
of a Responsible Officer of the Borrower certifying that to the actual knowledge
of such Responsible Officer such amendment, modification or waiver could not
reasonably be expected to have a Material Adverse Effect.
(h) ERISA. Become a member of an ERISA Group or incur any liability or
obligation with respect to any Plan, Multiemployer Plan or any Benefit
Arrangement; provided, however, that the Borrower may incur liabilities or
obligations under a plan or arrangement substantially in the form of (i) the
Form of Retirement Plan For Each Closed End Fund or (ii) the Form of Amended and
Restated Deferred Compensation Agreement each attached on Schedule II hereto;
provided, further, that the Borrower gives the Program Agent at least ten (10)
days prior written notice of any such amendment to the forms of the plan or
agreement that materially increases the Borrower's liabilities under the plan or
agreement.
(i) Investment Policies and Restrictions. Without the prior written consent
(which consent shall not be unreasonably withheld or delayed) of the Program
Agent and solely with respect to clause (i) without the prior written consent
(which consent shall not be unreasonably withheld or delayed) of the Secondary
Lenders (i) unless required by a change in Applicable Law (including, without
limitation, the Investment Company Act and the Securities Act), make or permit
any material change in the Investment Policies and Restrictions; provided, that
the Borrower may, without the prior written consent of the Program Agent and the
Secondary Lenders, make a material change to the Investment Policies and
Restrictions solely to
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the extent relating to tender offers or repurchases if such change would not
materially adversely effect any Conduit Lender, any Secondary Lender or the
Program Agent, or (ii) make or permit any change in any Industry Class used to
compute the Borrowing Base.
(j) Liens. Create, assume or suffer to exist any Adverse Claim on any Asset
now owned or hereafter acquired by it (including without limitation the Pledged
Collateral).
(k) Senior Securities. Issue any "senior securities", as such term is
defined and used in the Investment Company Act other than Permitted Senior
Securities.
(l) Margin Requirements. Extend credit to others for the purpose of buying
or carrying any "margin stock" in such a manner as to violate Regulation T,
Regulation U or Regulation X or use the proceeds of any Advance to purchase or
carry Margin Stock or, without limiting the foregoing, have more than twenty
percent (20%) of its total Assets constitute Margin Stock.
(m) Restricted Payments. Make any Restricted Payment (i) if any Default or
Event of Default shall be continuing or shall result therefrom, (ii) if
immediately after giving effect to such payment the Borrower will not be in full
compliance with the Borrowing Base Test and the Asset Coverage Test, (iii) at
any time after the Program Agent shall have delivered a Notice of Exclusive
Control to the Custodian (unless such Notice of Exclusive Control has been
revoked in writing by the Program Agent), or (iv) at any time after the
Termination Date.
(n) Name Change. Change its name (i) without giving the Program Agent at
least ten (10) days prior written notice, and (ii) unless all actions necessary
and reasonably appropriate to protect and perfect the Secured Parties' first
priority perfected security interest (subject to any Permitted Liens) in the
Pledged Collateral have been taken and completed.
(o) Custodian's Overdraft Advances. Permit the Aggregate Custodian's
Advance Amount to at any time exceed $50,000,000.
(p) Notice of Exclusive Control; Pledged Collateral. After the Borrower has
received written notice of delivery by the Program Agent to the Custodian of a
Notice of Exclusive Control, unless such Notice of Exclusive Control is revoked
in writing by the Program Agent, give any instruction to the Custodian in
respect of the Pledged Collateral without the prior written consent of the
Program Agent.
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ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.
If any of the following events shall occur and be continuing (each an
"Event of Default"):
(a) the Borrower shall fail to make or cause to be made in the manner and
when due (i) except as expressly provided in Section 2.05(b), any payment of
principal to be made or to be caused to be made by it under this Agreement and
such failure shall continue for one (1) Business Day, or (ii) any payment of
interest, fees or other deposit to be made or caused to be made by it under this
Agreement or any of the other Program Documents to which it is a party and such
failure shall continue for three (3) Business Days; or
(b) the Borrower shall (i) fail to be in compliance with the Asset Coverage
Test, provided that if a Responsible Officer of the Borrower has certified that
the Borrower is taking all steps necessary to cause the Borrower to be in full
compliance with the Asset Coverage Test within ten (10) Business Days after the
first date of the Borrower's knowledge of such noncompliance, such event shall
not constitute an Event of Default unless such failure shall continue for ten
(10) Business Days after such first date, or (ii) fail to comply with Section
2.05(b), Section 5.01(g) or clauses (c), (d), (e), (f), (g), (h), (i), (k), (l)
or (m) of Section 5.02; or
(c) (i) the Borrower shall fail to perform or observe any other term,
covenant or agreement on its part to be performed or observed under this
Agreement or any other Program Document to which it is a party, or (ii) the
Adviser shall fail to perform any of its obligations under the Letter Agreement,
which could reasonably be expected to have an Adviser Material Adverse Effect,
or (iii) the Custodian shall fail to perform or observe any term, covenant or
agreement on its part to be performed or observed under the Control Agreement,
which could reasonably be expected to have a Material Adverse Effect, or (iv)
the Custodian shall fail to perform or observe any term, covenant or agreement
on its part to be performed under the Custodial Agreement, which in the case of
this clause (iv), could reasonably be expected to have a Material Adverse Effect
and such failure described in the cases of clauses (i) through (iv) shall
continue unremedied for thirty (30) days after such person has knowledge of such
failure; or
(d) any representation or warranty made or deemed made by the Borrower, the
Adviser or the Custodian under or in connection with this Agreement, the Control
Agreement, the Letter Agreement or any certificate or report delivered by or on
behalf of the Borrower, the Adviser or the Custodian in connection therewith
shall have been false or incorrect in any material respect on or as of the date
made or deemed made or any material representation or warranty made or deemed
made by the Borrower, the Adviser or the Custodian in any other Program Document
to which it is a party or any certificate or report delivered by or on behalf of
the Borrower, the Adviser or the Custodian in connection therewith shall be
false or incorrect in any material respect when made or deemed made or
delivered; provided, however, that, with
48
respect to the representation set forth in Section 4.01(l), such event (except
to the extent relating to any Investor Report) shall not constitute an Event of
Default under this clause (d) if (i) such breach has not resulted in a Material
Adverse Effect, and (ii) the incorrect or incomplete information or report
giving rise to such breach was promptly corrected by the Borrower; or
(e) the Program Agent shall for any reason cease to have a valid and
perfected first priority security interest in the Pledged Collateral (subject to
the Lien of the Custodian securing the Custodian's Overdraft Advances to the
extent permitted by Section 5.02(o) and other Permitted Liens) free and clear of
all Adverse Claims or the Custodian, as collateral agent and/or securities
intermediary under the Control Agreement, shall not have custody and control, as
contemplated by the Control Agreement, of the Pledged Collateral; or
(f) the Borrower or the Custodian shall generally not pay its debts as such
debts become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors; or
any proceeding shall be instituted by or against the Borrower or the Custodian
seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to bankruptcy, insolvency
or reorganization or relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee, custodian or other similar
official for it or for any substantial part of its property and, in the case of
any such proceeding instituted against it (but not instituted by it), either
such proceeding shall remain undismissed or unstayed for a period of sixty (60)
days, or any of the actions sought in such proceeding (including an order for
relief against, or the appointment of a receiver, trustee, custodian or other
similar official for, it or for any substantial part of its property) shall
occur; or the Borrower or the Custodian shall take any corporate action to
authorize any of the actions set forth above in this subsection; or
(g) any provision of any Program Document shall cease to be a legal, valid
and binding obligation of any of the parties purported to be bound thereby,
enforceable in accordance with its respective terms or the Borrower, the Adviser
or the Custodian shall so assert in writing; or
(h) any judgment or order, or any series of judgments or orders, shall have
been entered against the Borrower, provided that (i) such judgments or orders
that have not been vacated, discharged, settled, paid or satisfied shall
aggregate to $5,000,000 or more at any one time outstanding (excluding any
judgments or orders related to any payment to or application by the Borrower
that is rescinded or must otherwise be returned or paid over as a result of any
bankruptcy, insolvency or similar proceeding involving any other Person), and
(ii) enforcement actions have been commenced with respect thereto and have not
been dismissed or stayed or bonded pending appeal within sixty (60) days of such
entry; or
(i) either (1) State Street Bank and Trust Company shall at any time cease
to serve as Custodian under the Custodial Agreement or the Control Agreement,
unless a successor thereto reasonably satisfactory to the Program Agent shall
have assumed the duties of Custodian
49
thereunder and in accordance with the terms of the Program Documents, or (2) the
Custodian or the Borrower shall have given notice of the termination of the
Custodial Agreement or the Control Agreement; provided, however, that events
specified in clause (2) above shall not constitute an Event of Default if prior
to the tenth (10th) Business Day immediately preceding the effective date of
such termination a successor custodian reasonably satisfactory to the Program
Agent shall have been appointed as custodian under the Custodial Agreement and
shall have assumed the obligations of the Custodian under the Custodial
Agreement and the Control Agreement and the Program Agent shall have received
such certificates and opinions as they shall have reasonably requested; or
(j) any event or condition shall occur which results in the acceleration of
the maturity of any Debt of the Borrower which Debt in the aggregate is at least
$3,000,000 or enables (or, with the giving of notice or lapse of time or both
would enable) the holder of such Debt or any Person acting on such holder's
behalf to accelerate the maturity thereof; or
(k) any change in Applicable Law (including, without limitation, the
Investment Company Act and the Securities Act) shall be enacted or promulgated
which (i) would limit in any material respect the ability of the Program Agent,
or any Secured Party to foreclose upon its interest in, or in the event of such
foreclosure to dispose of, the Pledged Collateral or to be granted the security
interest in Pledged Collateral as contemplated by this Agreement and the Control
Agreement, or (ii) unless such changes have been consented to in writing by the
Program Agent and the Secondary Lenders (which consent shall not be unreasonably
withheld or delayed), would require any material change to the Investment
Policies and Restrictions; or
(l) the Adviser shall cease to be a wholly owned direct or indirect
subsidiary of the Parent; or
(m) unless consented to in writing by the Program Agent (which consent
shall not be unreasonably withheld or delayed), the Advisory Agreement in effect
on the Closing Date or any replacement advisory agreement approved of in writing
by the Program Agent shall be (i) amended, waived or otherwise modified in any
material respect, or (ii) shall be terminated unless a replacement investment
advisory agreement has been entered into with a successor investment adviser
which is substantially similar in all material respects to the Advisory
Agreement in effect prior to any such termination; or
(n) ▇▇▇ ▇▇▇▇▇▇ Asset Management or another wholly-owned direct or indirect
subsidiary of the Parent (or another entity consented to in writing by the
Program Agent and the Secondary Lenders (which consent shall not be unreasonably
withheld or delayed) which has executed a letter agreement in favor of the
Program Agent on behalf of the Secured Parties substantially identical in all
material respects to the Letter Agreement), is not the current investment
adviser for the Borrower;
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then, and in any such event, in addition to all rights and remedies specified in
this Agreement, including without limitation, Article VII, and the rights and
remedies of a secured party under Applicable Law including, without limitation
the UCC, the Program Agent may, or upon the direction of the Majority Banks
shall, by notice to the Borrower, declare the Termination Date to have occurred
and declare the outstanding Advances to be due and payable (in which case the
Termination Date and the Maturity Date for all outstanding Advances shall be
deemed to have occurred); provided, that, upon the occurrence of any event
(without any requirement for the passage of time or the giving of notice, or
both) described in subsection (f) of this Section 6.01, the Termination Date and
the Maturity Date for all outstanding Advances shall be deemed to have
automatically occurred.
ARTICLE VII
PLEDGE OF PLEDGED COLLATERAL;
RIGHTS OF THE PROGRAM AGENT
SECTION 7.01. Security Interests.
In consideration of the Lenders and the Secondary Lenders making and
maintaining the Advances, and as collateral security for the prompt, complete
and unconditional payment and performance of all of the Borrower Obligations,
the Borrower hereby pledges (and in the case of all Pledged Collateral other
than the Loan Assets), hypothecates, assigns, transfers, sets over and delivers
to the Program Agent for the benefit of the Secured Parties and grants to the
Program Agent for the benefit of the Secured Parties a continuing Lien upon and
security interest in, all of the Borrower's right, title and interest in, to and
under the following assets and properties, whether now owned or existing or
hereafter arising or acquired and wheresoever located (the items specified in
clauses (i) through (viii) below, collectively, the "Pledged Collateral"):
(i) all of the Cash, Assets, investments and property from time to
time credited to the Collateral Account, and all security entitlements with
respect to the Collateral Account and all Loan Assets of the Borrower
evidenced by, secured by, or governed by any Loan Document;
(ii) the Collateral Account (together with all other accounts in which
the distributions referred to in clause (iii) below are remitted);
(iii) all interest, dividends, stock dividends, stock splits,
distributions and other money or property of any kind distributed in
respect of the assets, investments, property and security entitlements
described in clause (i) above, including without limitation the principal
payments in respect of such Loan Assets;
(iv) all rights and remedies of the Borrower under the Loan Documents
and the Custodial Agreement in respect of the assets, investments, property
and security entitlements described in clause (i) above;
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(v) all security interests, liens, collateral, property, guaranties,
supporting obligations, insurance and other agreements or arrangements of
whatever character from time to time supporting or securing payment of the
assets, investments, property and security entitlements described in clause
(i) above;
(vi) all accounts, contract rights, documents, instruments,
securities, investment property, chattel paper, general intangibles
(including payment intangibles), inventory, goods, equipment and all other
property of every kind and nature, now owned or hereafter acquired in
respect of the assets, investments, property and security entitlements
described in clause (i) above);
(vii) all books, records and other information (including, without
limitation, computer programs, tapes, discs, punch cards, data processing
software and related property and rights) relating to the assets,
investments, property and security entitlements described in clause (i)
above; and
(viii) all Proceeds of any and all of the foregoing.
Notwithstanding the foregoing provisions of this Section 7.01, the Pledged
Collateral shall not include Modified Margin Stock.
SECTION 7.02. Substitution of Collateral and Release of Security Interest.
(a) Subject to Section 5.02(p), so long as no Default or Event of Default
shall have occurred and be continuing or would occur as a consequence of such
sale, disposition or substitution and the Borrowing Base Test will be satisfied
immediately following such sale, disposition or substitution, the Borrower may
originate entitlement orders with respect to the Collateral Account and may sell
or dispose of or substitute Pledged Collateral in accordance with the terms of
this Agreement and the Control Agreement.
(b) On the Program Termination Date the Lien granted under this Agreement
shall be automatically terminated and released and the Program Agent at the
written request of the Borrower shall execute, deliver and file such instruments
as the Borrower shall reasonably request in order to reassign, release or
terminate its security interest in the Pledged Collateral. Any and all actions
under this Section 7.02 shall be without any recourse to, or representation or
warranty by, the Program Agent or any Secured Party and shall be at the sole
cost and expense of the Borrower.
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SECTION 7.03. Application of Proceeds.
(a) After the occurrence and during the continuance of an Event of Default,
all amounts remitted to the Program Agent's Account in respect of the Borrower
Obligations, including without limitation all Proceeds resulting from the sale
or other disposition of the Pledged Collateral shall be applied by the Program
Agent in the following order and priority:
First, to the payment of all amounts advanced or expended by the Program
Agent and all costs and expenses incurred by the Program Agent in connection
with the enforcement of the Secured Parties' rights and remedies under the
Program Documents;
Second, to the extent funds are remaining after the above application, to
the Lenders and the Secondary Lenders to the payment of all accrued and unpaid
Yield on all outstanding Advances on a pro-rata basis according to the amount of
accrued Yield owing to each Lender and each Secondary Lender;
Third, to the extent funds are remaining after the above applications, to
the Secured Parties to the payment of all fees payable under the Fee Letter on a
pro rata basis according to the amount of such fees owing to each such Secured
Party;
Fourth, to the extent funds are remaining after the above applications, to
the Lenders and the Secondary Lenders to the payment of the principal amount of
each outstanding Advance on a pro-rata basis according to the amount of
principal owing to each Lender and each Secondary Lender;
Fifth, to the extent funds are remaining after the above applications, to
the Secured Parties to the payment of all other amounts payable to the Secured
Parties pursuant to this Agreement and the other Program Documents on a pro rata
basis according to the amounts owed to each such Secured Party.
The Program Agent shall, once the Program Termination Date has
occurred, remit the remaining excess Proceeds which it had received from the
sale or disposition of the Pledged Collateral to the Borrower's Account.
(b) For purposes of determining the application to be made of such monies
and other cash proceeds by the Program Agent to other Secured Parties pursuant
to this Section 7.03, the Program Agent may rely exclusively upon a certificate
or other statement of such Secured Party setting forth in reasonable detail the
amount then owing to such Secured Party. The Program Agent shall not be liable
for any application of funds in accordance with any certificate or direction
delivered pursuant to this Section 7.03; provided, however, that no application
of funds in accordance with any certificate delivered pursuant to this Section
7.03 shall be deemed to restrict or limit the right of any party to contest with
the purported obligee its respective liability in respect of the amount set
forth in such certificate.
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SECTION 7.04. Rights and Remedies upon Event of Default.
(a) The Program Agent (for itself and on behalf of the other Secured
Parties) shall have all of the rights and remedies of a secured party under the
UCC and other Applicable Law. Upon the occurrence and during the continuance of
an Event of Default, the Program Agent or its designees may (i) deliver a Notice
of Exclusive Control to the Custodian; (ii) instruct the Custodian to deliver
any or all of the Pledged Collateral and any Loan Documents relating to the
Pledged Collateral to the Program Agent or its designees and otherwise give all
instructions and entitlement orders to the Custodian regarding the Pledged
Collateral; (iii) sell or otherwise dispose of the Pledged Collateral, all
without judicial process or proceedings; (iv) take control of the Proceeds of
any such Pledged Collateral; (v) subject to the provisions of the applicable
Loan Documents, exercise any consensual or voting rights in respect of the
Pledged Collateral; (vi) release, make extensions, discharges, exchanges or
substitutions for, or surrender all or any part of the Pledged Collateral; (vii)
enforce the Borrower's rights and remedies under the Custodial Agreement with
respect to the Pledged Collateral; (viii) institute and prosecute legal and
equitable proceedings to enforce collection of, or realize upon, any of the
Pledged Collateral; (ix) require that the Borrower and the Custodian promptly
take action to liquidate the Pledged Collateral to pay amounts due and payable
in respect of the Borrower Obligations; (x) remove from the Borrower's, the
Adviser's and their respective agents' place of business all books, records and
documents relating to the Pledged Collateral unless copies thereof shall have
been provided to the Program Agent which copies of such books and records shall
thereafter be deemed to be originals thereof; and/or (xi) notify all Selling
Institutions, Transaction Agents and Obligors related to the Loan Assets which
constitute Pledged Collateral to make payments in respect thereof directly to
the Program Agent's Account; (xii) at the request of the Program Agent execute
all documents and agreements which are necessary or appropriate to have the
Pledged Collateral which constitutes Loan Assets to be assigned to the Program
Agent or its designee; and (xiii) endorse the name of the Borrower upon any
items of payment relating to the Pledged Collateral or upon any proof of claim
in bankruptcy against an account debtor. For purposes of taking the actions
described in Subsections (i) through (xiii) of this Section 7.04(a) the Borrower
hereby irrevocably appoints the Program Agent as its attorney-in-fact (which
appointment being coupled with an interest is irrevocable while any of the
Borrower Obligations remain unpaid), with power of substitution, in the name of
the Program Agent or in the name of the Borrower or otherwise, for the use and
benefit of the Program Agent, but at the cost and expense of the Borrower and
with notice to the Borrower.
(b) All sums paid or advanced by the Program Agent in connection with the
foregoing and all reasonable out-of-pocket costs and expenses (including,
without limitation, reasonable outside attorneys' fees and expenses) incurred in
connection therewith, together with interest thereon at the Post-Default Rate
from the date of payment until repaid in full, shall be paid by the Borrower to
the Program Agent on demand and shall constitute and become a part of the
Borrower Obligations secured hereby.
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SECTION 7.05. Remedies Cumulative.
Each right, power, and remedy of the Program Agent and the other Secured
Parties, or any of them, as provided for in this Agreement or in the other
Program Documents or now or hereafter existing at law or in equity or by statute
or otherwise shall be cumulative and concurrent and shall be in addition to
every other right, power, or remedy provided for in this Agreement or in the
other Program Documents or now or hereafter existing at law or in equity or by
statute or otherwise, and the exercise or beginning of the exercise by the
Program Agent or any other Secured Party of any one or more of such rights,
powers, or remedies shall not preclude the simultaneous or later exercise by
such Persons of any or all such other rights, powers, or remedies.
Section 7.06. Enforcement of Remedies under the Custodial Agreement and
Loan Documents.
(a) The Borrower agrees that it shall, (i) during the continuance of a
Default or an Event of Default, upon the request of the Program Agent (and at
the Borrower's own expense) diligently enforce the rights and remedies under the
Custodial Agreement and at law or equity against the Custodian for any material
breach by the Custodian of any term, covenant or agreement thereunder relating
to or affecting any Pledged Collateral, and (ii) diligently enforce its rights
and remedies under the Loan Documents relating to the Pledged Collateral. The
Borrower, shall at all times enforce its rights and remedies under the Custodial
Agreement and the Loan Documents with the same degree of care and diligence that
it would exercise if this Agreement had not been entered into; provided, that,
during the continuance of a Default or an Event of Default, the Borrower shall
not, in enforcing such rights and remedies, settle any claim against the
Custodian without the prior written consent of the Program Agent (which consent
shall not be unreasonably withheld or delayed).
(b) The Borrower agrees that to the extent not expressly prohibited by the
terms of the related Loan Documents, after the occurrence and during the
continuance of an Event of Default, it shall (i) upon the written request of the
Program Agent promptly forward to the Program Agent all information and notices
which it receives under or in connection with the Loan Documents relating to the
Pledged Collateral, and (ii) act and refrain from acting, in respect of any
request, act, decision or vote under the Loan Documents relating to the Pledged
Collateral only in accordance with the direction of the Program Agent.
ARTICLE VIII
THE PROGRAM AGENT
SECTION 8.01. Authorization and Action.
Each of the Secured Parties hereby irrevocably appoints and authorizes the
Program Agent to take such action as agent on its behalf and to exercise such
powers under this Agreement and the other Program Documents as are delegated to
the Program Agent by the
55
terms hereof and thereof, together with such powers as are reasonably incidental
thereto. The Program Agent shall not have any duties or responsibilities, except
those expressly set forth herein or in the other Program Documents, or any
fiduciary relationship with any Secured Party, and no implied covenants,
functions, responsibilities, duties or obligations or liabilities on the part of
the Program Agent shall be read into this Agreement or any other Program
Document or otherwise exist for the Program Agent. As to any matters not
expressly provided for by this Agreement or the other Program Documents, the
Program Agent shall not be required to exercise any discretion or take any
action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Majority Banks; provided, however, that the Program Agent shall not be
required to take any action which exposes the Program Agent to personal
liability or which is contrary to this Agreement, the other Program Documents or
Applicable Law. Each Secured Party agrees that in any instance in which the
Program Documents provide that the Program Agent's consent may not be
unreasonably withheld, provide for the exercise of the Program Agent's
reasonable discretion, or provide to a similar effect, it shall not in its
instructions to the Program Agent withhold its consent or exercise its
discretion in an unreasonable manner.
SECTION 8.02. Delegation of Duties.
The Program Agent may execute any of its duties under this Agreement and
each other Program Document by or through agents or attorneys-in-fact and shall
be entitled to advice of counsel concerning all matters pertaining to such
duties. The Program Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
SECTION 8.03. Program Agent's Reliance, Etc.
Neither the Program Agent nor any of its directors, officers, agents or
employees shall be liable for any action taken or omitted to be taken by it or
them under or in connection with this Agreement or any of the other Program
Documents, except for its or their own gross negligence or willful misconduct.
Without limiting the generality of the foregoing, the Program Agent: (i) may
consult with legal counsel (including counsel for the Borrower or the Adviser)
and independent public accountants and other experts selected by it and shall
not be liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (ii) makes
no warranty or representation to any Secured Party or any other Person and shall
not be responsible to any Secured Party or any Person for any statements,
warranties or representations (whether written or oral) made in or in connection
with this Agreement or the other Program Documents; (iii) shall not have any
duty to ascertain or to inquire as to the performance or observance of any of
the terms, covenants or conditions of this Agreement, the other Program
Documents or any Loan Documents on the part of the Borrower, the Adviser, the
Custodian or any other Person or to inspect the property (including the books
and records) of the Borrower or the Adviser; (iv) shall not be responsible to
any Secured Party or any other Person for the due execution, legality, validity,
enforceability, genuineness, sufficiency
56
or value of this Agreement, the other Program Documents, any Loan Document or
any other instrument or document furnished pursuant hereto or thereto; and (v)
shall incur no liability under or in respect of this Agreement or any other
Program Document by acting upon any notice, consent, certificate or other
instrument or writing (which may be delivered by telecopier, telegram, cable or
telex) believed by it to be genuine and signed or sent by the proper party or
parties.
SECTION 8.04. Indemnification.
Each of the Secondary Lenders agrees to indemnify and hold the Program
Agent harmless (to the extent not reimbursed by or on behalf of the Borrower)
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against the Program Agent in any way relating to or arising out of this
Agreement or any other Program Document or any action taken or omitted by the
Program Agent under this Agreement or any other Program Document; provided, that
no Secondary Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Program Agent's gross negligence or
willful misconduct. Without limitation of the foregoing, each of the Secondary
Lenders agrees to reimburse the Program Agent promptly upon demand for any
out-of-pocket expenses (including reasonable counsel fees) incurred by the
Program Agent in connection with the administration or enforcement (whether
through negotiations, legal proceedings or otherwise) or legal advice in respect
of rights or responsibilities under this Agreement or the other Program
Documents, to the extent that the Program Agent is not reimbursed for such
expenses by or on behalf of the Borrower. Each Secondary Lender shall be
obligated to pay its Proportionate Share of all amounts payable to the Program
Agent under this Section 8.04. As used in this Section 8.04, the term
"Proportionate Share" in respect of any Secondary Lender means the fraction,
expressed as a percentage, the numerator of which is the Secondary Lender
Commitment of such Secondary Lender and the denominator of which is the Total
Commitment.
SECTION 8.05. Successor Program Agent.
The Program Agent may, upon thirty (30) days' notice to the Borrower, the
Conduit Lenders and the Secondary Lenders, resign as Program Agent. If the
Program Agent shall resign, then the Majority Banks during such thirty (30) day
period shall appoint from among the Secondary Lenders a successor program agent.
If for any reason a successor program agent is not so appointed and does not
accept such appointment during such thirty (30) day period, the Program Agent
may appoint a successor program agent. Any resignation of the Program Agent
shall be effective upon the appointment of a successor program agent pursuant to
this Section 8.05 and the acceptance of such appointment by such successor.
After the effectiveness of any retiring Program Agent's resignation hereunder as
Program Agent, the retiring Program Agent shall be discharged from its duties
and obligations hereunder and under the other Program Documents and the
provisions of this Article VIII and Section 9.04 shall
57
continue in effect for its benefit with respect to any actions taken or omitted
to be taken by it while it was Program Agent under this Agreement and under the
other Program Documents.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. No Waiver; Modifications in Writing.
No failure or delay on the part of any Secured Party in exercising any
right, power or remedy hereunder or with respect to the Advances shall operate
as a waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. The remedies provided for herein are
cumulative and are not exclusive of any remedies that may be available to any
Secured Party, at law or in equity. No amendment, modification, supplement,
termination or waiver of this Agreement shall be effective unless the same shall
be in writing and signed by each of the Borrower, the Conduit Lenders and the
Program Agent. Any waiver of any provision of this Agreement, and any consent to
any departure by the Borrower from the terms of any provision of this Agreement,
shall be effective only in the specific instance and for the specific purpose
for which given. No notice to or demand on the Borrower in any case shall
entitle the Borrower to any other or further notice or demand in similar or
other circumstances. Notwithstanding the foregoing, in no event shall the
Secondary Lender Commitment of any Secondary Lender be extended or increased
without the written consent of such Secondary Lender.
SECTION 9.02. Notices, Etc.
Except where telephonic instructions are authorized herein to be given, all
notices, demands, instructions and other communications required or permitted to
be given to or made upon any party hereto shall be in writing and shall be
personally delivered or sent by registered, certified or express mail, postage
prepaid, or by prepaid telegram (with messenger delivery specified in the case
of a telegram), or by facsimile transmission, or by prepaid courier service, and
shall be deemed to be given for purposes of this Agreement on the day that such
writing is received by the intended recipient thereof. Unless otherwise
specified in a notice sent or delivered in accordance with the foregoing
provisions of this Section 9.02, notices, demands, instructions and other
communications in writing shall be given to or made upon the respective parties
hereto at their respective addresses (or to their respective facsimile numbers)
indicated below, and, in the case of telephonic instructions or notices, by
calling the telephone number or numbers indicated for such party below:
58
If to the
Conduit Lenders: Falcon Asset Securitization Company LLC
c/o JPMorgan Chase Bank, N.A.
Mail Suite ▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Portfolio Management
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Chariot Funding LLC
▇/▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇.▇.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇-▇▇▇▇
Chase Tower
Chicago, Illinois 60670-0597
Attention: Portfolio Management
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
If to JPMorgan, as
Program Agent or
Secondary Lender: JPMorgan Chase Bank, N.A.
Mail Suite ▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Portfolio Management
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
If to State Street
Bank and Trust
Company: State Street Bank and Trust Company
Mutual Fund Lending
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Vice President
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to The Bank of
New York: The Bank of New York
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
59
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.:(▇▇▇) ▇▇▇-▇▇▇▇
If to Lloyds TSB
Bank plc: Lloyds TSB Bank plc
1251 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Borrower: ▇▇▇ ▇▇▇▇▇▇ Senior Loan Fund
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Senior Loan Group
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
SECTION 9.03. Taxes.
(a) Any and all payments owed to any Secured Party, Affected Person or
Indemnified Party by the Borrower under this Agreement or any other Program
Document (other than any Loan Document) to which it is a party shall be made, in
accordance with this Agreement, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
of the Secured Parties, (i) United States federal withholding taxes and (ii)
income, profits and franchise taxes imposed on it by any taxing Authority in any
jurisdiction which asserts jurisdiction to impose such taxes on the basis of
contacts which the Secured Party in question maintains with such jurisdiction
other than contacts arising solely out of the execution, delivery or performance
of the Program Documents or the transactions contemplated thereby (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder or under any other Program Document (other than any Loan Document) to
which it is a party to any Secured Party, (i) the sum payable shall be increased
as may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 9.03) such
Secured Party receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with Applicable Law.
60
(b) In addition, the Borrower agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made by the Borrower to any Secured Party,
any Affected Person or any Indemnified Party hereunder or under any other
Program Document (other than any Loan Document) to which the Borrower is a party
or from the execution, delivery or registration of, or otherwise with respect
to, this Agreement or under any other Program Document (other than any Loan
Document) to which it is a party (hereinafter referred to as "Other Taxes").
(c) The Borrower will indemnify each of the Secured Parties for the full
amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section
9.03) paid by any Secured Party in respect of the Borrower and any liability
(including penalties, interest and expenses) (other than such as are the result
of such Person's action or failure to take action) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted. This indemnification shall be made within thirty (30) days
from the date the Secured Party makes written demand therefor to the Borrower.
(d) Within thirty (30) days after the date of receiving a receipt for any
payment of Taxes or Other Taxes, the Borrower will furnish to the Program Agent
the original or a copy of a receipt evidencing payment thereof.
(e) With respect to an assignment or appointment of a successor program
agent, the assignee or successor program agent (including such that is already a
party to this Agreement) shall not be entitled to increased amounts or Other
Taxes pursuant to this Section 9.03 in excess of the amount to which its
transferor or predecessor, as the case may be, was entitled.
(f) To the extent legally entitled to do so, each Secured Party and
participant shall provide to the Borrower and Program Agent (as applicable) such
forms or other certifications at such time(s) and in such manner(s) as will
permit payments to be made under this Agreement without deduction for, or at a
reduced rate of, withholding taxes.
(g) If any Secured Party determines, in its sole discretion, that it has
actually received or realized any refund or tax, any reduction of, or credit
against, its tax liabilities or otherwise recovered any amount that would not
have been received, realized or recovered but for any deduction or withholding,
or payment of any additional amount, by the Borrower pursuant to this Section
9.03 or Section 2.07, then so long as no Default or Event of Default shall have
occurred and be continuing, such Secured Party shall reimburse the Borrower an
amount that the Secured Party shall, in its sole discretion, determine is equal
to the net benefit after tax, and net of all expenses incurred by the Secured
Party in connection with its receipt or realization of such refund, reduction,
credit or recovery; provided, that nothing in this paragraph (g) shall require
any Secured Party to make available its tax returns (or any other information
relating to its taxes which it deems to be confidential). The Borrower shall
return such amount to the applicable
61
Secured Party in the event that the Secured Party is subsequently required to
repay such refund of tax or is not entitled to such reduction of, or credit
against, its tax liabilities.
(h) Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreement and obligations of the Borrower contained in
this Section 9.03 shall survive the termination of this Agreement and the
payment in full of principal and Yield hereunder until the expiration of all
applicable statutes of limitation.
SECTION 9.04. Costs and Expenses; Indemnification.
(a) The Borrower agrees to promptly pay on written demand all reasonable
costs and expenses (excluding any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, in each case, now or hereafter imposed, levied, collected, withheld or
assessed) of each of the Secured Parties, in connection with the preparation,
review, negotiation, reproduction, execution, delivery, modification, amendment
and enforcement of this Agreement and the other Program Documents to which the
Borrower is a party, including, without limitation, the reasonable fees and
disbursements of counsel for the Secured Parties with respect thereto and with
respect to advising the Secured Parties, as to its rights, remedies and
responsibilities under this Agreement and the other Program Documents to which
the Borrower is a party, UCC filing fees, periodic auditing expenses incurred in
connection with clauses (h) and (i) of Section 5.01 and all other related fees
and expenses.
(b) The Borrower agrees to indemnify and hold harmless each Secured Party
and each of their Affiliates and the respective officers, directors, employees,
agents, managers of, and any Person controlling any of, the foregoing (each, an
"Indemnified Party") from and against any and all claims, damages, losses,
liabilities, obligations, expenses, penalties, actions, suits, judgments and
disbursements of any kind or nature whatsoever, (including, without limitation,
the reasonable fees and disbursements of counsel), but excluding in all cases
any and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, in each case, now or
hereafter imposed levied, collected, withheld or assessed (collectively the
"Liabilities") that may be incurred by or asserted or awarded against any
Indemnified Party, in each case arising out of or in connection with or by
reason of the execution, delivery, enforcement, performance, administration of
or otherwise arising out of or incurred in connection with this Agreement, any
Loan Document or any other Program Document to which the Borrower is a party or
any transaction contemplated hereby or thereby (and regardless of whether or not
any such transactions are consummated), including, without limitation any such
Liability that is incurred or arises out of or in connection with, or by reason
of any one or more of the following: (i) preparation for a defense of, any
investigation, litigation or proceeding arising out of, related to or in
connection with this Agreement or any other Program Document to which the
Borrower is a party or any of the transactions contemplated hereby or thereby;
(ii) any breach or alleged breach of any covenant by the Borrower contained in
any Program Document to which the Borrower is a party; (iii) any representation
or warranty made or deemed made by the Borrower contained in any Program
Document to which the
62
Borrower is a party or in any certificate, statement or report delivered in
connection therewith is, or is alleged to be, false or misleading; (iv) any
failure by the Borrower to comply with any Applicable Law or contractual
obligation binding upon it; (v) any failure to vest, or delay in vesting, in the
Secured Parties a first priority perfected (subject to the Lien of the Custodian
securing the Custodian's Overdraft Advances to the extent permitted by Section
5.02(o) and other Permitted Liens) security interest in all of the Pledged
Collateral; (vi) any action or omission, not expressly authorized by the Program
Documents to which the Borrower is a party, by the Borrower which has the effect
of reducing or impairing the Pledged Collateral or the rights of the Program
Agent or the Secured Parties with respect thereto; (vii) any Default or Event of
Default relating to the Borrower; (viii) any claim that any Secured Party has
assumed any obligation or liability of the Borrower under any Loan Document or
otherwise; and (ix) any transactions related to the funding, carrying or
repayment of the outstanding principal amount of the Advances in connection with
the Program Documents to which the Borrower is a party; except to the extent any
such Liability is found in a final, non-appealable judgment by a court of
competent jurisdiction to have resulted from such Indemnified Party's gross
negligence, bad faith or willful misconduct.
(c) For the avoidance of doubt, neither the payment of any Liability by the
Borrower under Section 9.04(b) nor the terms of Section 9.04(b) shall be deemed
to limit any right or cause of action the Borrower may have against any
Indemnified Party or any other Person. Without prejudice to the survival of any
other agreement of the Borrower hereunder, the agreements and obligations of the
Borrower contained in this Section 9.04 shall survive the termination of this
Agreement and the payment in full of principal and Yield on the Advances.
SECTION 9.05. Execution in Counterparts.
This Agreement may be executed in any number of counterparts and by
different parties hereto on separate counterparts, each of which counterparts,
when so executed and delivered, shall be deemed to be an original and all of
which counterparts, taken together, shall constitute but one and the same
agreement.
SECTION 9.06. Assignability.
(a) This Agreement and each Conduit Lender's rights and obligations herein
(including the outstanding Advances) shall be assignable by such Conduit Lender
to an Eligible Assignee; provided, that without the prior written consent of the
Borrower (which consent shall not be unreasonably withheld or delayed and which
consent shall, in any event not be required if an Event of Default shall have
occurred and be continuing) such Conduit Lender shall not assign its obligations
under this Agreement to any Person other than to a U.S. Affiliate of the Program
Agent which is a special purpose entity that issues commercial paper. Each such
assignor shall notify the Program Agent and the Borrower of any such assignment.
Each such assignor may, in connection with the assignment or participation,
disclose to the assignee or participant any information relating to the
Borrower, including the Pledged Collateral, furnished to such assignor
63
by or on behalf of the Borrower or by the Program Agent; provided that, prior to
any such disclosure, the assignee or participant agrees to preserve the
confidentiality of any confidential information relating to the Borrower
received by it from any of the foregoing entities. Notwithstanding the
foregoing, without the consent of the Borrower, each Conduit Lender may,
pursuant to the Asset Purchase Agreement or otherwise, sell, assign, transfer
and convey all or any portion of the Advances maintained by such Conduit Lender,
together with all rights hereunder and under the Program Documents in respect
thereof, to any bank or financial institution which is also a Secondary Lender.
(b) Each Secondary Lender may, with the consent of the Borrower (which
consent shall not be unreasonably withheld or delayed and which consent shall,
in any event, not be required if an Event of Default shall have occurred and be
continuing), assign to any Eligible Assignee or to any other Secondary Lender
all or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Secondary Lender Commitment and the
outstanding Advances or interests therein owned by it); provided, that the
Borrower's consent to any such assignment shall not be required if the assignee
is an existing Secondary Lender or a U.S. Affiliate of an existing Secondary
Lender. The parties to each such assignment shall execute and deliver to the
Program Agent an Assignment and Acceptance. Notwithstanding the foregoing, each
Secondary Lender may assign any of its rights (including, without limitation,
rights to payment of principal and Yield on the Advances) under this Agreement
to any Federal Reserve Bank without notice to or consent of the Borrower.
(c) The Program Agent may, with the consent of the Borrower (which consent
shall not be unreasonably withheld or delayed and which consent shall not be
required if an Event of Default has occurred and is continuing), assign this
Agreement and its rights and obligations hereunder; provided, that the
Borrower's consent to any such assignment shall not be required if the assignee
is a U.S. Affiliate of the Program Agent.
(d) Except for an assignment by operation of law to the extent expressly
permitted by Section 5.02(d), the Borrower may not assign its rights or
obligations hereunder or any interest herein without the prior written consent
of the Program Agent and the Secondary Lenders.
(e) The Borrower acknowledges and agrees that each Lender's (other than the
Conduit Lenders) and each Secondary Lender's source of funds may derive in part
from its participants. Accordingly, references in Sections 2.06, 2.07, 2.08,
9.03 and 9.04 and the other terms and provisions of this Agreement and the other
Program Documents (other than the Loan Documents) to rates, determinations,
reserve and capital adequacy requirements, expenses, increased costs, reduced
receipts and the like as they pertain to the Lenders (other than the Conduit
Lenders) and the Secondary Lenders shall be deemed also to include those of each
of its participants; provided, that no participant shall be entitled to any
amount under any such Sections or provisions, which is greater than the amount
the related Lender or Secondary Lender, as the case may be, would have been
entitled to under any such Sections or provisions if the applicable
participation had not occurred.
64
(f) The Program Agent shall maintain at its address specified in Section
9.02 or such other address as the Program Agent shall designate in writing to
the Conduit Lenders and Secondary Lenders, a copy of this Agreement and each
signature page hereto and each Assignment and Acceptance delivered to and
accepted by it and a register (the "Register") for the recordation of the names
and addresses of such Secondary Lenders, their Secondary Lender Commitments,
effective dates and Secondary Lender Stated Expiration Dates, and the aggregate
outstanding principal amount of the outstanding Advances made by each such
Secondary Lender under this Agreement. The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Program Agent and the Secondary Lenders may treat each Person
whose name is recorded in the Register as a Secondary Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower or any Secondary Lender at any reasonable time and from time to
time upon reasonable prior notice.
SECTION 9.07. Governing Law.
THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE
STATE OF ILLINOIS, AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF SAID STATE.
SECTION 9.08. Severability of Provisions.
Any provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
SECTION 9.09. Confidentiality.
(a) The Borrower agrees that it shall (i) keep this Agreement, the Control
Agreement, the Fee Letter, the Letter Agreement, the proposal relating to the
structure of the facility contemplated by this Agreement, (the "Facility"), any
analyses, computer models, information or document prepared by the Program Agent
or any of its Affiliates in connection with the Facility, the Program Agent's or
any of its Affiliate's written reports to the Borrower, the Adviser or any of
their respective Affiliates and any related written information (collectively,
the "Product Information") confidential and to disclose Product Information only
to those of its officers, employees, agents, accountants, regulators, financial
advisors, trustees, directors, legal counsel and other representatives
(collectively, the "Borrower Representatives") who may have a need to know or
review such Product Information for the purpose of assisting in the negotiation,
evaluation, completion and administration of the Facility; (ii) use the Product
Information only in connection with the Facility and not for any other purpose;
and (iii) cause the Borrower Representatives to comply with the provisions of
this Section 9.09 and to be responsible for any
65
failure of any Borrower Representative to so comply. The Borrower shall not
disclose Product Information to any third-party for the purpose of enabling such
third-party to provide senior debt to the Borrower.
The provisions of this Section 9.09(a) shall not apply to any Product
Information that is a matter of general public knowledge or that has heretofore
been made available to the public by any Person other than the Borrower, the
Adviser, any of their respective Affiliates or any Borrower Representative or
that is required to be disclosed by applicable law or regulation or is requested
by any Authority with jurisdiction over the Borrower, the Adviser, any Borrower
Representative or any of their respective Affiliates, it being understood that
any such disclosure or filing shall not relieve the Borrower, the Adviser, any
of their respective Affiliates or any Borrower Representative of any of its
obligations under this Section 9.09(a). Each of the Borrower and the Adviser
agree that if any Product Information is required by applicable law or
regulation to be included by it in any filing with the SEC or any other
Authority it shall, in consultation with the Program Agent, use its reasonable
best efforts to "black-out" all information which is not necessary under
applicable law or regulation to be included in such filing which the Program
Agent deems is of a sensitive nature and in no event shall the Fee letter or the
Investor Report be disclosed in any such filing.
(b) Each of the Secured Parties agrees (i) to keep all non-public
information with respect to the Borrower and the Adviser and their respective
Affiliates which such Secured Party receives pursuant to the Program Documents
(collectively, the "Borrower Information") confidential and to disclose Borrower
Information only to those of its officers, employees, agents, accountants, legal
counsel and other representatives of the Secured Parties (collectively, the
"Secured Party Representatives"), to providers of program-wide credit
enhancement for, other financings to, or investors in the Conduit Lenders, and
to S&P, ▇▇▇▇▇'▇ or any other rating agency that rates the promissory notes of
the Conduit Lenders which, in each case, may have a need to know or review such
Borrower Information for the purpose of assisting in the negotiation,
completion, administration and evaluation of the Facility; (ii) to use the
Borrower Information only in connection with the Facility and not for any other
purpose; and (iii) to cause its related Secured Party Representatives to comply
with the provisions of this Section 9.09(b).
The provisions of this Section 9.09(b) shall not apply to any Borrower
Information that is a matter of general public knowledge or that has heretofore
been made available to the public by any Person other than any Secured Party or
any Secured Party Representative or that is required to be disclosed by
applicable law or regulation or is requested by any Authority with jurisdiction
over any Secured Party or Secured Party Representative or any of its Affiliates.
Notwithstanding the foregoing, the Borrower Information may be disclosed by
any Secured Party Representative to permitted assignees and participants and
potential assignees and participants in the Facility to the extent such
disclosure is made pursuant to a written agreement of confidentiality
substantially similar to this Section 9.09(b).
66
(c) Notwithstanding anything in this Section 9.09 to the contrary, the
parties hereto (and each of their respective employees, representatives or other
agents) may disclose to any and all Persons, without limitation of any kind, the
"tax treatment" and "tax structure" (in each case within the meaning of Treasury
Regulation Section 1.6011-4) of the Facility and all materials of any kind
(including opinions or other tax analyses) that are provided to it, relating to
such tax treatment and tax structure of the Facility, other than any information
for which non-disclosure is reasonably necessary in order to comply with
applicable securities laws.
SECTION 9.10. Merger.
The Program Documents (other than the Loan Documents) taken as a whole
incorporate the entire agreement between the parties thereto concerning the
subject matter thereof. The Program Documents (other than the Loan Documents)
supersede any prior agreements among the parties thereto relating to the subject
matter thereof.
SECTION 9.11. No Proceedings.
Each of the parties to this Agreement and each assignee of any Advance or
any interest therein and each entity which enters into a commitment to make
Advances to the Borrower hereunder hereby agrees that it will not institute
against any Conduit Lender any proceeding of the type referred to in Section
6.01(f) so long as any commercial paper or other senior indebtedness issued by
any Conduit Lender shall be outstanding or there shall not have elapsed one year
plus one day since the last day on which any such commercial paper or other
senior indebtedness shall have been outstanding. The obligations of each Conduit
Lender under and in connection with this Agreement and the other Program
Documents are solely the obligations of such Conduit Lender. It is expressly
agreed that no recourse shall be had for the payment of any amount owing by or
in respect of any Conduit Lender in respect of this Agreement or any other
Program Document or for any other obligation of, or claim against, such Conduit
Lender arising out of or based upon this Agreement or any other Program
Document, against any member, stockholder, employee, officer, manager, director,
organizer or incorporator of such Conduit Lender or against any member,
stockholder, employee, officer, manager, director, organizer or incorporator of
any such member, stockholder or manager.
SECTION 9.12. Survival of Representations and Warranties.
All representation and warranties made hereunder, in the other Program
Documents (other than the Loan Documents) and in any document, certificate or
statement delivered pursuant hereto or thereto or in connection herewith or
therewith shall survive the execution and delivery of this Agreement and the
making of the Advances hereunder.
67
SECTION 9.13. Loan Documents.
No obligation or liability of the Borrower is intended to be assumed by the
Program Agent or any other Secured Party under or as a result of this Agreement
or the other Program Documents, and the transactions contemplated hereby and
thereby, including, without limitation, under any Loan Document and, to the
maximum extent permitted under provisions of law, the Program Agent and the
other Secured Parties expressly disclaim any such assumption.
If an Event of Default under Section 6.01(f) in respect of the Borrower
shall have occurred and is continuing or the Program Agent shall have delivered
a Notice of Exclusive Control to the Custodian, and such notice has not been
revoked by the Program Agent, the Borrower will use its best efforts to obtain
and give all necessary consents under all Loan Documents relating to any Pledged
Collateral and execute and deliver all agreements and documents which are
necessary or appropriate in order to enable the Secured Parties to enforce their
rights and remedies hereunder and under the other Program Documents, including
without limitation, to permit the Pledged Collateral which constitutes Loan
Assets to be assigned to the Program Agent or its designees. In addition, the
Borrower shall pay all assignment fees which are required to be paid pursuant to
the Loan Documents relating to the Pledged Collateral in connection with the
foregoing. The Program Agent and the Secured Parties acknowledge that in order
to enforce certain of their remedies in respect of the Pledged Collateral which
constitutes Loan Assets after the occurrence and during the continuance of an
Event of Default, certain provisions of the related Loan Documents may need to
be complied with, including provisions requiring the consent of the related
Transaction Agent and/or Obligor.
The Program Agent agrees that if it would be prevented from reviewing any
Loan Document relating to an Eligible Loan Asset in connection with the exercise
of its rights under Section 5.01(i) or Section 7.04, as a result of any
confidentiality agreement entered into by the Borrower in respect thereof, and
if it's review of such Loan Documents would be permitted if it agrees to
maintain the confidentiality of such Loan Documents in accordance with the terms
of such confidentiality agreement (each such confidentiality agreement a
"Subject Confidentiality Agreement"), the Program Agent hereby agrees to abide
by the terms of such Subject Confidentiality Agreement in respect of such Loan
Documents.
SECTION 9.14. Submission to Jurisdiction; Waivers.
The Borrower hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement or the other Program Documents (other than the Loan
Documents) to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general jurisdiction of any
United States Federal or Illinois State court sitting in Chicago, Illinois, and
the appellate courts of any of them;
(b) consents that any such action or proceeding may be brought in any of
such courts and waives any objection that it may now or hereafter have to the
venue of any such
68
action or proceeding in any such court or that such action or proceeding was
brought in an inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in Section 9.02 or at such other address as may be permitted
thereunder;
(d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to ▇▇▇ in
any other jurisdiction or court; and
(e) waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.
SECTION 9.15. E-Mail Reports.
Subject to the following terms and conditions the Borrower may, unless
otherwise notified to the contrary by the Program Agent, transmit Investor
Reports to the Program Agent by electronic mail (each an "E-Mail Report"). Each
E-Mail Report shall be formatted as the Program Agent may reasonably designate
from time to time. Each E-Mail Report shall be sent to the Program Agent at an
electronic mail address designated by the Program Agent, and the executed
"summary sheet" for each E-Mail Report shall be transmitted via facsimile
transmission to the Program Agent at the facsimile numbers specified for the
Program Agent in Section 9.02.
SECTION 9.16. Waiver of Jury Trial.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES
TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR
ANY OTHER PROGRAM DOCUMENT (OTHER THAN ANY LOAN DOCUMENT) TO WHICH THE BORROWER
IS A PARTY OR FOR ANY COUNTERCLAIM THEREIN OR RELATING THERETO.
SECTION 9.17. Several Obligations.
Except for the commitment of the Secondary Lenders to make Advances if the
Conduit Lenders have declined to make an Advance to the extent expressly
required by Section 2.02, no Lender or Secondary Lender shall be responsible for
the failure of any other Lender or Secondary Lender to make any Advance or to
perform any obligation under this Agreement or any other Program Document. The
Program Agent shall not have any liability to the Borrower, any Lender or any
Secondary Lender for the Borrower's, any Lender's or any
69
Secondary Lender's, as the case may be, performance of, or failure to perform,
any of their respective obligations and duties under this Agreement or any other
Program Document.
SECTION 9.18. Limitation on Liability.
No claim may be made by the Borrower or any other Person against the
Program Agent, any Lender or any Secondary Lender or their respective
Affiliates, directors, officers, employees, attorneys or agents for any special,
indirect, consequential or punitive damages in respect of any claim for breach
of contract or any other theory or liability arising out of or related to the
transactions contemplated by this Agreement or any other Program Document, or
any act, omission or event occurring in connection therewith; and the Borrower
hereby waives, releases, and agrees not to ▇▇▇ upon any claim for any such
damages, whether or not accrued and whether or not known or suspected to exist
in its favor.
As provided for in Section 5.5 of the Amended and Restated Declaration of
Trust, made as of September 19, 1989 and subsequently amended, of the Borrower
(under which the Borrower is organized as a voluntary association with
transferable shares under the laws of the Commonwealth of Massachusetts), the
shareholders, trustees, officers, employees and other agents of the Borrower
shall not personally be bound by or liable for the matters set forth herein or
in any other Program Document, nor shall resort be had to their private property
for the satisfaction of any obligation or claim hereunder or under any other
Program Document.
SECTION 9.19. Patriot Act Notice.
Each of the Lenders hereby notifies the Borrower that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law on October 26, 2001)) (the "Patriot Act"), it is required to obtain, verify
and record information that identifies the Borrower, which information includes
the name and address of the Borrower and other information that will allow such
Lender to identify the Borrower in accordance with the Patriot Act. The Borrower
shall, and shall cause each of its subsidiaries, if any, to, provide to the
extent commercially reasonable, such information and take such actions as are
reasonably requested by any Lender in order to assist such Lender in maintaining
compliance with the Patriot Act.
SECTION 9.20. No Novation.
It is the intent of the parties hereto that this Agreement (i) shall
re-evidence, in part, the Borrower's indebtedness under the Existing Credit
Agreement, (ii) is entered into in substitution for, and not in payment of, the
obligations of the Borrower under the Existing Credit Agreement, and (iii) is in
no way intended to constitute a novation of any of the Borrower's indebtedness
which was evidenced by the Existing Credit Agreement or any of the other Program
Documents (as defined in the Existing Credit Agreement).
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
▇▇▇ ▇▇▇▇▇▇ SENIOR LOAN FUND,
as Borrower
By: ▇▇▇▇▇▇ Tiffen
-------------------------------
Name: ▇▇▇▇▇▇ Tiffen
Title: President
FALCON ASSET SECURITIZATION COMPANY LLC,
as Conduit Lender
By JPMorgan Chase Bank, N.A.,
its attorney-in-fact
By: ▇▇▇▇▇ ▇. English
-------------------------------
Name: ▇▇▇▇▇ ▇. English
Title: Vice President
CHARIOT FUNDING LLC,
as Conduit Lender
By JPMorgan Chase Bank, N.A.,
its attorney-in-fact
By: ▇▇▇▇▇ ▇. English
-------------------------------
Name: ▇▇▇▇▇ ▇. English
Title: Vice President
JPMORGAN CHASE BANK, N.A,,
as Secondary Lender and Program Agent
By: ▇▇▇▇▇ ▇. English
-------------------------------
Name: ▇▇▇▇▇ ▇. English
Title: Vice President
Secondary Lender Percentage: 64.29%
Secondary Lender Commitment: $450,000,000
STATE STREET BANK AND TRUST COMPANY,
as Secondary Lender
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
Secondary Lender Percentage: 10.71%
Secondary Lender Commitment: $75,000,000
THE BANK OF NEW YORK,
as Secondary Lender
By: ▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
Secondary Lender Percentage: 14.29%
Secondary Lender Commitment: $100,000,000
LLOYDS TSB BANK plc,
as Secondary Lender
By: ▇▇▇▇▇▇▇ ▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Assistant Vice President
By: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Assistant Vice President
Secondary Lender Percentage: 10.71%
Secondary Lender Commitment: $75,000,000